Credit Card Statement Enhancements Hit Mailboxes July 1

Written by Joe Taylor Jr.
Posted On: June 28, 2010

By July 1, credit card issuers must streamline and standardize their monthly statements, making them easy for consumers to understand. If you haven't already seen changes to your monthly credit card bill, here's what to expect:

Account Activity, Clear Due Dates, and Minimum Payments
Banks must now provide the big picture: How much you paid off, how much you spent, and how much you have to pay before you're debt-free. Credit card issuers must prominently display the deadline for receiving an "on-time" payment and the minimum amount they expect you to send. Some banks earned harsh criticism from Congress for burying these details in small type. New rules require large, readable text.

Plain English Penalty Warnings
In simple language, banks must now tell you about what can happen to your account if you make a late payment or if you fail to make your minimum payment. Banks must also show you a grid outlining how long your debt lasts if you make only the minimum monthly payment, as well as the amount you must pay every month if you want to??pay off??your account in three years.

Advance Notices of Account Changes
This year's new rules impose a 45-day notification period before your credit card company can change your interest rates or your fee schedule. While this can protect you from fee creep, it can also give you time to adjust your habits or make balance transfers if you've triggered a penalty interest rate.

Breakouts of Transactions and Fees, YTD Totals, and Finance Charge Reports
New statement designs must list transactions separately from fees. That way, you don't see a balance transfer fee or an annual fee buried among a page full of your usual credit card charges. You also see a report detailing how much you've paid in interest during your most recent statement cycle, and how that stacks up to your annualized fees and finance charges.

When the Federal Reserve required banks to adopt a standard "Schumer Box" detailing rates and fees on their credit card applications, consumers gained awareness of credit cards' hidden costs. Lawmakers hope that similar clarity on credit card statements can help cardholders make smarter decisions about their finances.