Republican senators on Wednesday blocked an effort to debate a bill that would prevent credit card companies from raising interest rates ahead of new regulations coming into force next year.
The move angered congressional Democrats who were pushing for an emergency freeze on credit card rates.
"I’m extremely disappointed that the financial health of millions of American taxpayers has been completely brushed aside by a handful of Wall Street banking interests in the US Senate," Rep. Betsy Markey (D-CO) said, as quoted in the Coloradoan.
Sen. Chris Dodd (D-CT), who heads the Senate Banking Committee, had authored a bill that would have prevented credit card issuers from hiking interest rates ahead of a new law coming into effect in February that restricts how and when rates can be raised.
Earlier this year, Dodd wrote and passed through the Senate the Credit Card Accountability, Responsibility and Disclosure (CARD) Act, which requires credit card issuers to give customers advance notice before hiking rates and fees.
That bill comes into force in February. But, as news sources reported earlier this year, credit card companies took advantage of the delay to hike interest rates before the bill became law.
Dodd's latest bill would freeze credit card rates where they are now until the new law comes into effect next year. It would also require credit card companies to review all interest hikes going back to the beginning of 2009 to see if customers were overcharged.
But when Dodd asked for the Senate's unanimous consent to discuss the bill, Sen. Thad Cochran (R-MI) "objected on the behalf of several of his GOP colleagues, preventing debate," reports The Hill.
"Knowing that the Credit CARD Act would finally protect consumers from these abuses, the industry has tried to make one last grab for their customers' pocketbooks," Dodd said Wednesday.
"The reason we allowed a gap period between the passage of the legislation and the imposition of the regulations or the statutory requirements was because the industry came to me and said, you know senator, we're going to need some time to administer, to change how we provide these kinds of benefits to people. So would you give us a little window here to operate?" Dodd said.
"Unfortunately they've taken that window and used it as a way to jam in on the consumers of this country," Dodd said.
A Rasmussen poll released Tuesday shows that about half of Americans -- 50 percent -- saw their credit card interest rates go up in the past six months.