My Card Account: CARD Act

What is the new federal law for the credit card industry?

The new federal law, also referred to as the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009, was signed into law on May 22, 2009. The CARD Act sets new standards across the credit card industry and impacts how all credit card companies do business.

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When will the new federal regulations go into effect?

The majority of the CARD Act requirements will take effect on February 22, 2010. However, some provisions took effect on August 20, 2009 and others will be effective on August 22, 2010.

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Which companies are impacted by the new federal law?

The CARD Act applies to all consumer credit cards, including those issued by Discover Card

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Will Discover comply with the new federal law?

Discover is already in compliance with some requirements of the CARD Act and is committed to being compliant with all requirements by the applicable effective dates. As always, we will continue to deliver great value to our customers, such as America’s #1 cash rewards program*, award-winning customer service and tools to help them better manage their finances.

*More U.S. households have a Discover Card than any other cash rewards card (TNS 2009 Consumer Card Strategies Research)

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What are the key requirements of the law and how will they impact my consumer Discover account?

The following is a list of key changes that are being made to consumer Discover Accounts as a result of the CARD Act. We have already informed Discover Cardmembers impacted by these changes.

How payments are applied
CARD Act Requirement: Any amount paid over the minimum payment must be applied to highest rate balances first.
Impact on your Discover Account: For payments received on or after February 1, 2010, Discover will apply payments in excess of the minimum payment to high APR balances first.

Overlimit Fees
CARD Act Requirement: Credit card companies now need to obtain a Cardmember’s consent before charging overlimit fees.
Impact on your Discover Account: Starting February 1, 2010, Discover will no longer charge a fee if you exceed your credit limit.

Making Payments
CARD Act Requirement: There are now restrictions on charging fees for making a payment.
Impact on your Discover Account: Starting February 1, 2010, Discover will not charge any fees for making a payment. Additionally, we are extending the cut-off time by which mailed payments must be received at our processing facility to be credited as of that day, from 1PM to 5PM local time.

Interest Rate Increases
CARD Act Requirement: There are now certain restrictions on increasing rates on existing balances.
Impact on your Discover Account: Starting January 1, 2010, we will no longer increase Annual Percentage Rates (APRs) on existing credit card balances if you pay late or go over your credit limit.

Double-Cycle Billing
CARD Act Requirement: Double-cycle billing is now prohibited.
Impact on your Discover Account: No impact on your account as Discover Card is already in compliance with this requirement.

Enhancements to your Billing Statements
CARD Act Requirement: Billing statements now need to provide additional information to help you manage your account.
Impact on your Discover Account: Starting February 2010, you may see some changes in the design and content of your billing statements. In addition to the information we always provide, statements will now feature easy-to-spot headings and sections in even simpler language. You may also see additional information on making minimum payments and on the fees and rates that may apply if your payment is late.

You can find additional information on statement changes on www.discover.com/newformat

Please note that the CARD Act has several requirements and that the above changes do not encompass all of them. For a summary of the CARD Act prepared by the United States Senate Committee on Banking, Housing, & Urban Affairs, please visit: http://banking.senate.gov/public/_files/051909_CreditCardSummaryFinalPassage.pdf

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