Congressional hearings on abusive credit card practices have spurred some positive changes in the credit card industry. Chase Bank, for example, one of the top five credit card issuers in the country, will stop the practice of increasing cardholder’s APRs when their credit score declines beginning March 1. They’ve also announced the elimination of ‘universal default’ fees which occur when you pay late on any credit card - even if it’s with another company. Consumer action groups are hoping that Chase competitors will respond with similar announcements.

Chase also took other actions in response to the congressional hearings. Wesley Wannemacher of Ohio testified that he racked up $7,500 in interest, late-payment and over-the-limit fees on original debt of $3,200. Chase responded by eliminating ‘over-the-limit’ fees on balances that exceed the limit for more than 90 days and the two-cycle billing practice, a calculation that results in higher interest charges.

Last year, Citigroup, another top credit card issuer, eliminated their practice of ‘universal default’ as well. They also promised not to change the original APR of a cardholder’s account until the card expires, which is typically two years. Both Citi and Chase announced they will only adjust cardholder’s APRs based on their payment history, which means rates can still go up when payments are late or credit limit is exceeded.

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