Recently, there has been some talk on Capitol Hill of adding some new legislation in the area of controlling the fees that credit card companies charge. For some, this legislation may seem like a godsend, while for others, it’s just another power grab by “Big Brother”. Let’s examine the issue for a bit, so that you can make an informed decision on which way you lean.

By way of some background information, let’s take a look at some of the fees that credit card companies charge. The primary fees of concern here are the late-charge fees, and the automatic increase of interest rates due to late payments. Almost all credit card companies charge these types of fees, but most are not particularly forthcoming about the conditions under which these charges are incurred. They are buried in the “fine-print” of the terms and conditions one receives when they are first approved for a credit card.

In business terms, it is only right that a creditor can charge late fees and raise interest rates when presented with a higher risk, such as a customer who is habitually late with payments or looks to be in jeopardy of filing for bankruptcy. The question is, are the credit card companies targeting these types of people with these fees? Sadly, the answer is no.

The fact of the matter is, one single late payment, even if it is only hours late, will incur these charges. Credit card companies are using the fees as a way of boosting profits rather than as a risk adjuster. What’s more, these companies do not provide the information in a clear, forthright manner to ensure that the customer is absolutely aware of the consequences of a single late payment. To really understand the breadth and depth of the problem, have a look at the videos available at http://provantacorp.com/secret.htm.

Enough people have complained about these practices to their legislative representatives that some in Congress feel that it is time to do something about it. On the other hand, the credit card lobbyists claim that new legislation will only hurt the industry by denying credit to those who are of higher risk, and that they should be allowed to devise a solution to the problem on their own. In fact, this is the same two sides of the story that always arise when ANY business issue comes before Congress, and both sides are legitimate concerns.

Ultimately, the question you need to answer for yourself to decide where you stand on this issue is who do you feel represents your interests more closely? Does big business (the credit card companies) provide a better answer by way of profit incentive, or do elected officials provide better answers by way of reelection incentive? How do you feel?