New Credit-Card Reform Law Excludes Small Business Cardholders

It has been about a month since President Obama signed new credit-card reform laws.  The goal of the new reforms is to protect individual cardholders from long-term practices in the industry such as changing terms on short notice and unexpected jumps in interest rates.  However, the popular business credit cards that many small businesses have relied on for years will not be subject to the same change.

Card companies are combating the new law, which won’t go into effect until February 2010, by increasing rates on current business cardholders.  Small business cardholders are upset about the sudden increases, but they aren’t being left with many options; they can choose to close their accounts within a month of the announced increase to avoid the hit.

Paul Hartwick, a spokesman for Chase, is claiming the recent increases in small business credit cards is not due to the new law, but is instead based on, “borrower risk, market conditions, and the costs to us of making the loans…”

Congress attempted to include small businesses with fewer than 50 employees in the new law, but the effort failed.  There is a glimmer of hope, however, as the law ordered the Federal Reserve to monitor the use of small business credit cards and present their findings to Congress sometime next year.

Click here to read the entire article: No Relief for Small Business Cardholders.

One Response to “New Credit-Card Reform Law Excludes Small Business Cardholders”

  1. » Credit Cards for Small Businesses Says:

    […] to small businesses is also the main contributing factor causing them to fail.  Unfortunately, credit card reform laws put in place by President Obama earlier this summer do not give small businesses the same […]