the VOA Special English Economics Report.
cards let people buy things now and pay for them over months or even years. But
some people get deep into debt. And critics say some banks have terms and
charges that can make it harder for people to pay off that debt.
United States, there are calls for stronger government supervision of the
credit card industry.
cards have been heavily marketed through the mail and at stores. They offer
economic power at a price.
thousand four, Americans had about eight hundred billion dollars in credit card
debt. Now they owe about nine hundred sixty-eight billion. The average interest
rate on those cards is currently thirteen and a half percent.
say banks made it too easy to get credit cards. But that may be changing. The
crisis in the housing and credits markets is beginning to affect the credit
card industry. More payments are late. Charges for late payments are a growing
source of profit for banks. But late payments can also signal bad debts.
central bank, the Federal Reserve, says two-thirds of American banks have
recently reported tighter lending requirements. Many people report having their
credit limits reduced without warning.
lawmakers are concerned that cardholders do not have enough protections from
what critics say are abusive policies. These include actions like raising
interest rates because of an unrelated event -- like a missed payment on
another debt. Also, banks may raise the chances of a late payment by changing
monthly payment dates for credit cards.
has been considering bills to increase cardholder protections. The industry
sees no need for more rules.
percent of Americans think credit cards provide a valuable service. But a
majority, fifty-eight percent, say they do not trust credit card companies. And
three out of four think the government should regulate the industry more
are among the findings released this week from a national survey.
CreditCards.com, an online marketplace, reported the findings based on a
out of four people feel there is always some condition that makes a card less
appealing than the company made it sound. And a little more than half say they
have had a card that was not as good as they expected. But close to eighty
percent say no one really reads the terms and conditions when they sign up for
a credit card.
that's the VOA Special English Economics Report, written by Mario Ritter. I'm Steve Ember.