When the Senate passed the credit-card reform bill on Tuesday, it was hailed as "a great day for consumers." That may be so, but what about small business owners who've been struggling with credit cards? The short answer: It depends on how your small business is incorporated, and what card you have.
The Credit Card Accountability Responsibility and Disclosure Act ends several card policies that consumers find offensive. Like retroactive rate increases on existing balances for cardholders in good standing; hiking rates for new charges without at least 45 days' notice; "double-cycle billing," which allows fees to be charged for balances that were already paid off; and "universal default," which applies rate hikes if a customer is late with payments on unrelated bills.
For small businesses, here's the catch. The new law amends the Truth in Lending Act, which only governs consumer loans, so it doesn't apply to corporate cards. So, if you use your personal card to make business purchases, you'll be covered by the new protections. Same with business cards based on your personal credit. But there's more.
For more info check out CNN's full article.
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