The CARD Act that was signed by the President and implemented a few months ago contains some rules and regulations that have far reaching impact for card holders. Here is a quick look into some rules and their impact on the users.

While credit cards are easier to understand and more transparent now, financial analysts and experts feel that on the whole these plastic cards will become heavy on the pocket and out of reach for families with low income. Fewer rewards on cards and higher annual fees are staging a comeback with the implementation of the new rules. The grace period being offered on credit cards are being reduced.

On the upside, banks and other financial institutions will not be able to implement an adhoc increase to the rate of interest on your card. Banks will have to intimate card holders at least 45 days in advance and offer them the option of closing their card, in case they do not want to opt for the rate increase. The late charges have also been capped, and the penalty fees have been reduced. The new rules and regulations of the CARD Act have also brought about changes in the way credit cards are billed and advertised.

The interest rate hikes can come into effect only under certain circumstances. The first rate hike will be at the end of the promotional period or if the consumers delay their payment. In all other cases, there have to be a gap of one year before any rate change is made on the card holder’s account.