Capital One Confirms Credit Card Interest Rate Freeze

Capital One sends millions of letters every month, but none as welcome as the letter received this week in October 2009, by a Colorado lawmaker. In the letter, a Capital One president assured Representative Betsy Markey that his company would not be raising interest rates on its credit card accounts in advance of new lending regulations that could take effect as early as December.

Ryan Schnieder, who oversees Capital One's credit card operations, responded to a letter signed by Markey and other members of Congress. The lawmakers noted a heightened level of concerns about the banking industry's repricing policies since the signing of the Credit CARD Act into law. Schneider's response highlighted some of his company's proactive efforts to implement many of the Act's new directives before the deadlines imposed by the Federal Reserve.

Capital One joins Bank of America and Discover in declaring that current credit card customers in good standing will keep their existing interest rate structures. However, some Bank of America and Capital One customers who have already been switched from fixed-rate to adjustable-rate credit cards may notice their interest rates rising as recovering financial markets help boost the Prime Rate.