The media has been speculating for some time about what changes to the industry the CARD act will bring.   Since the law has now been in effect for 24 hours, we can now pass judgment on it for all time.

Surprise Surprise, Reward Cards Are Going Strong

In the run up to CARD, there were no shortage of misinformed “experts” who seemed sure that the banks would stop issuing credit cards to “deadbeats” who always pay their balance in full and never accrue interest.    At best, we deadbeats would get to keep our credit cards, but our rewards would disappear.   I didn’t believe them then or now.   Here is a report from American Public Media’s Marketplace program, which airs on NPR stations.    The reporters conclude, surprise!, that right now the people who pay their bills on time and in full are the bank’s best customers.   They even interview a deadbeat customer who is raking in the cash back by using American Express’s Blue card.   I can sympathize with the feeling that you are literally wearing your card out.     Let’s just say that my Starwood Amex has seen better days.

But They Will Hit Us With Fees….

There is a popular meme in the press that goes something like this; “With the new regulations, consumers can expect a slew of new fees from their bank to make up for their losses from practices outlawed by CARD”.      The next thing they do is point to a handful of anecdotal examples.   Take this article for instance.

…the industry reacted so aggressively to the legislation. Among the moves it made:

_ Resurrected annual fees.

Annual fees, common until about 10 years ago, have made a comeback. During the final three months of last year, 43 percent of new offers for credit cards contained annual fees, versus 25 percent in the same period a year earlier, according to Mintel International, which tracks marketing data. Several banks also added these fees to existing accounts. One example: Many Citigroup customers will star