A Credit Card Bill That Would Actually Be Good

By Chris Crum - Thu, 09/25/2008 - 10:32am.

House Approves Credit Cardholders' Bill of Rights Act

Yesterday, Doug discussed business credit-building pointers, quoting Tyson Elliott who named making sure you have a business credit card as the most basic step. Unfortunatley, credit card companies don't always play fair, and that is a notion that has sparked the House of Representatives to approve a bill to keep these companies from exercising practices that are harmful to small business owners.

The Credit Cardholders' Bill of Rights Act was approved today by the House, and strongly urges the Senate to take up "companion legislation" so that small business owners in America can see that "Wall Street isn't the only street in America that matters in Washington, D.C."

"Imagine if I, as a small-business owner, was allowed to routinely change my terms of engagement with my clients at any time for any reason -- it's just unthinkable," stated Larry Nannis, National Small Business Association (NSBA) vice chair for advocacy and small-business owner from Needham, Massachusetts. "Yet, credit-card companies do this every day. All we are asking for is basic fairness -- that credit-card companies be held to the same standards as any other business."

This bill aims to change that and the economy could improve as a result. As the NBSA noted in its release on the matter, such practices by credit card companies can hinder the growth of small businesses all over the country, and this can lead to the hamstringing of the economy as a whole.

The NSBA also refers to a nationwide survey, in which it found that 44% of small-business owners identified credit cards as a source of financing they had used in the previous 12 months - more than any other source of
financing, including business earnings. That is truly a testament to the importance of credit cards to a business' success, and it makes you wonder how many businesses have gone under simply because credit cards companies were greedy.

This looks to be an important piece of legislation, and it will be interesting to see if the Senate backs it up.

News Tags: Legal, house of representatives, Credit Cards, Senate, Economy, Legislation, government

About the author:
Chris is a content coordinator and staff writer for SmallBusinessNewz and the iEntry Network. Subscribe to SmallBusinessNewz RSS Feeds.

Comments

By Guest (SBN reader) - Tue, 09/30/2008 - 11:16am.

Credit Card Bill

I agree with author Chris Crum that the Credit Cardholders Bill of Rights is a good thing. It's way overdue. Credit card companies have been ripping off consumers for years with their accounting techniques, hidden fees and generally unreputable practices. What's worse they prey on our youngest and most naive citizens, recruiting at colleges and high schools. I wonder if this bill will do enough. I remember a time when small merchants were pressured to offer S & H Green stamps or Blue Chip stamps with purchases. They were led to believe they couldn't compete without offering the service. Then merchants got wise and cut it off, and guess what -- they survived! I wonder if the same thing couldn't happen with credit cards. Credit card companies gouge consumers with high interest rates and they charge the merchants on top of it. Suppose merchants simply refused to honor credit cards anymore. If the public could be weined off the credit card habit, the economy would improve tremendously. Ron Coleman

By Dan (SBN reader) - Tue, 09/30/2008 - 12:32pm.

Credit Card Bill of Rights

I applaud congress for passing this and hope that the Senate follows them. As a small business owner, one of the hardest things is for me is maintaining proper lines of credit. I only have one business credit card because I don't trust credit cards to be a reliable credit source. This may change my mind. However, if they don't pass the bank bailout bill soon there may not be credit available for anyone. Dan Bowler

By Chuck Miser (SBN reader) - Sat, 10/11/2008 - 10:05pm.

Credit Card loans for business

I went down that path and used my credit card to fianace a growing business, and the bank was sold and the new bank changed the pattern on the billing cycles and I was late by hours twice with out realizing it, and was reassured when my payments doubled for those months that everything was fine. Anyway to make a long story shorter the bank then took me from 9% upto to 24% on the interest rate and lowered my credit limit from 32K to 10K so with two late payments and my limit being adjusted down my Fico score went from a 740 to high 500 so ofcourse nobody would do a transfer of ballance anymore, so i was stuck holding 28K at 24% which just started digging a hole so I sold the business to get out from underneath the debt which was starting to mount.

Be creative and find another way to get cash for your business is the best advise I can offer anyone thinking of using Visa or Mastercard as a lending source.

By Fred (SBN reader) - Sat, 10/11/2008 - 10:08pm.

Visa

Thanks for sharing that Chuck I had the same basic thing happen to me when i used a credit card and it was a nightmare to dig out of.

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