by Joseph Kenny | 06/6/09

Recently, President Obama signed into law a new generation of credit card reform legislation. The question of what impact this aggressive reform would mean for the credit card industry and the economy prompted consumer financing and debt expert Bradford Stroh.

Stroh, the co-founder and co-CEO of free online financial portal Bills.com and sister company Freedom Debt Relief made a few pointed comments regarding the new laws and what role they could play in the future of the whole credit card industry.

"Overall, this law is long overdue," said Stroh. "Credit card companies do need regulation. The law is not partisan, and it has leveled the playing field so as to make things fair to consumers."

Still, Stroh believes that any significant credit card reform has a long road ahead if it is to achieve lasting results.

"This legislation is a wonderful start, but we still need to address the issue of preemption. In a nutshell, federal regulations still exist that preempt state interest-rate caps and consumer protection laws."

Stroh also suggested that preemption could be beneficial for the entire credit card industry since they profit through the exportation of interest rates and fees that would be limited by state law.

"Federal preemption should end; either the credit card industry should be regulated at state level or a national standard implemented to be consistent with many states' limitations on interest rates and fees," said Stroh.

Stroh made it clear that having better disclosure should be a goal since it is important to consumer to understand how long it will take to get out of debt if they make minimum payments only.

Areas of the new bill that Stroh has suggested will be impacted and influenced include the history of preemption in the banking industry, possible restrictions on available credit for lenders, impact on consumers and credit scores, as well as how the legislation will affect bank profitability.