Credit Card Fairness Act: Better Credit Card Protection To Help Canadians Get Ahead

Ottawa, ON, 2018/10/31- Rachael Harder, Member of Parliament for Lethbridge, introduced her Private Member’s Bill, the Credit Card Fairness Act in the House of Commons this afternoon.


Since being elected in 2015, MP Harder has talked with thousands of Canadians from all parts of the country who are concerned about fairness and transparency when it comes to credit cards.


“We live in a society where it is nearly impossible to function without one—you need a credit card to book a flight, a hotel room, shop on-line, etc. – but unfortunately, consumers aren’t being treated with the respect they deserve,” she said.


She went on to explain that “due to rising interest rates, and life being more expensive than ever, Canadians are struggling to make ends meet. Canadians are falling further and further behind.”


The Credit Card Fairness Act calls for seven measures aimed at ending deceptive banking practices in the credit card industry, while empowering consumers to make informed choices with regard to the use of credit cards.


MP Harder explained that “by increasing fairness and transparency, the reforms outlined in my bill will empower credit card holders to make informed decisions, pay off debt faster, and achieve greater financial freedom.”


 If passed, the Credit Card Fairness Act will:

1.Mandate that if a cardholder pays more than 95% of the outstanding balance before the payment due date, the bank cannot charge interest on the amount paid on or before the due date. The bank can only charge interest on the amount outstanding after the due date.

2.Ensure that payments made by the credit card holder are applied to balances with the highest interest rate first, before being applied to balances at a lower interest rate.

3.Require banks to disclose on the monthly statement how much interest the cardholder has paid in the previous 12 months.

4.Require that marketing materials prominently communicate the annual fee, annual interest rate and the period of time until the introductory rate ends, along with the interest rates that will apply following that period.

5.Prohibit banks from increasing interest rates retroactively on the cardholder’s outstanding balance owing.

6.Require banks to provide an on-line mechanism for consumers to cancel their credit cards and/or decrease their credit limit (right now, a cardholder must phone or visit the bank in person).

7.Legislate that banks must obtain consent before increasing a cardholder’s credit limit.