call today

(856) 988-9055

New Jersey businesses get no credit card debt relief in Congress

Why are small business credit cards in New Jersey treated differently from personal credit cards when it comes to consumer rights? Businesses often have as much of a need to discharge credit card debt as do individuals. That was what a New York lawmaker wondered, and moved to correct with her introduction of the Small Business Credit Card Act of 2013.

The bill is her attempt to right the wrong she said has persisted since the October 2010 enactment of the original CARD Act. That original Act was intended to increase transparency and strengthened consumer rights within the credit card industry. The CARD Act, however, did not cover credit cards marked exclusively for use by small businesses. The Congresswoman’s bill would expand this coverage, but it is not likely to be voted into law. This meant that small businesses using credit cards probably would not enjoy the same protection as individuals using credit cards any time soon. Thus, small businesses need to work on stabilizing their debt without the help of lawmakers.

It was estimated that about 37 percent of owners of small businesses leverage their credit card debt each year. Those consumers were not protected under the CARD Act, which meant that banks and credit card companies could jack up a card’s interest rates entirely at will. The one bank that did extend this protection to its credit card holders was Bank of America.

With or without the help of Congress, individuals and businesses in New Jersey sometimes need to discharge credit card debt. A lawyer with experience in helping people stop creditor harassment may be able to negotiate with banks on their clients’ behalf when the consumer has become overwhelmed with unmanageable monthly payments.

Source: ABC News, “Small Business v. Personal credit cards: how they’re different“, Odysseas Papadimitriou, August 24, 2013

Speak Your Mind

*

contact the firm