If 2009-2010 has told credit card industry anything, it is thatthe famous Berra-ism (It Ain’t Over Until It’s Over) does not applyto card regulation.For the foreseeable future, new regulatorycompliance will be an ongoing challenge.The staged implementationof the CARD Act was just a starting point; even the CARD Act willcontinue to deliver new compliance requirements.
As other commentators have pointed out, while the FederalReserve’s recent amendments to the CARD Act might not rank high onthe regulatory Richter scale (they closed some importantambiguities around rate changes, total fees, and measuring abilityto pay), the fact that they were issued at all is important.This isjust one sign of increased attention to come.
Other indicators confirm this direction.Announced inmin-November, one of the first major appointees to the new ConsumerFinancial Protection Bureau team, David Silberman, will head theteam responsible for credit card research and rulemaking.Creditcard regulations and disclosures are clearly a priority for the newagency.
The big question, of course, is how consumers will ultimatelybenefit, or if they will even notice.Data from our CustomerMonitorSurvey Series indicate that about 6 in 10 credit cardholders areaware of the Act, but fewer connect concrete credit benefits to theAct.But a vast majority of those aware of the CARD Act do rememberreceiving new cardholder agreements in the mail.
As an industry, we had better think of regulation as a stream,rather than periodic hurdles that must be met.Since the flow islikely to be continuous, the industry will need to become a lotmore nimble about implementing operational changes and deliveringnew disclosures.
At least we can be sure the US Postal Service will appreciatethe fact that it’s never “Over.”
