On July 15, 2009, the Federal Reserve Board approved an interim final rule amending Regulation Z requiring creditors to provide consumers with at least 45 days’ written notice before the creditor increases an annual percentage rate on a credit card account or makes a significant change to the terms of a credit card account. In the same notice, creditors must inform consumers of their right to cancel the credit card account before the increase or change goes into effect. If a consumer does so, the creditor is generally prohibited from applying the increase or change to the account. The interim final rule also requires creditors generally to mail or deliver periodic statements for credit cards and other open-end consumer credit accounts at least 21 days before payment is due.
These revisions are the first stage in the Federal Reserve Board's implementation of the Credit Card Accountability Responsibility and Disclosure Act of 2009 (Credit CARD Act) signed into law by President Obama on May 29, 2009. The Credit CARD Act amended the Truth in Lending Act (TILA) and other statutes to establish fair and transparent practices for open-end consumer credit plans, including credit cards. The interim final rule implements the provisions of the Credit Card Act that go into effect on August 20, 2009. The remaining provisions go into effect on February 22 or August 22, 2010 and will be implemented by the Federal Reserve Board at a later date. Comments on the interim final rule must be submitted within 60 days after publication in the Federal Register, which is expected shortly.