NEW YORK—It appears as if the CARD ACT has almost put an end to fixed-rate credit cards—once a staple among many credit unions.
A new report reveals that less than 5% of the 2,335 credit card agreements on file with the Bureau of Consumer Financial Protection are related to cards with fixed or non-variable interest rates, Bankrate reported.
Most of the roughly 60 fixed-rate agreements on file came from small lenders with limited regional footprints, Bankrate said.
“The number of fixed-rate cards available dwindled after the CARD Act took effect in 2010. The law mandated that card issuers give fixed-rate borrowers at least a 45-day notice before hiking rates. Cards tied to federal interest rates don't require the same heads-up before rate increases, which prompted many card issuers to pull back on fixed-rate products and push out variable-rate options, Bankrate said.