Senate passes credit-card reforms

The Senate passed a measure on Tuesday that would limit significantly the powers of the credit-card industry, but an amendment loosening gun laws at national parks threatens to delay a compromise with the House.

The measure, which passed by a 90-5 vote, curbs the ability of credit-card companies to increase interest rates and assess fees and penalties. The House easily passed a similar version earlier this spring.

President Obama has asked Congress to send him a credit-card-reform bill by the end of the week.

Work on a compromise, however, has been complicated by the gun rights provision inserted into the Senate version by Sen. Tom Coburn, Oklahoma Republican. The amendment would allow visitors to national parks to carry concealed firearms unless otherwise prohibited by state law — a measure that has angered liberals and gun-control activists.

Rep. Carolyn B. Maloney, New York Democrat and sponsor of the bill’s House version, called Mr. Coburn’s amendment “wacky.”

“Tacking on guns in parks to a strong consumer bill simply makes no sense,” she said.

House Democratic aides say the chamber likely will accept the Senate bill but strip out the Coburn amendment into a separate vote. The gun provision, which is supported by Republicans and conservative Democrats, is expected to survive.

The Senate credit-card bill would ban credit-card companies from increasing interest rates on existing balances unless a cardholder was 60 days behind payment. Rates on accounts without any delinquenices would be frozen during the first year of the account.

Any interest-rate increase would be subject to a periodic review and would be lowered if the review determined the increase was arbitrary or unfair.

Credit-card issuers would have to notify cardholders 45 in advance of any increases in interest rates, fees and finance charges. Statements would be required to be mailed 21 days before the bill is due, rather than the current 14 days.

The measure also would prohibit credit-card companies from charging interest on paid-off balances from a previous billing cycle, commonly referred to as a “double-cycle billing ban,” and make it tougher for anyone under 21 to open an account.