Fed's Credit Card Database Gets Poor Marks

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Staying on top of credit card terms and credit card agreements is a frustrating task for many cardholders. For those holding several credit cards in particular, keeping track of the ever-changing terms across several cards often seems downright impossible.

Wouldn’t it be nice if there was an online, searchable database of credit card agreements? A place where cardholders could go and with a quick search determine the redemption rules for their rewards credit cards, find information about how their card issuer applies payments above the minimum, look up the penalties for late payments, and even better, compare these terms across different credit cards?

Well, this is exactly what one of the new provisions in the Credit CARD Act of 2009 set out to accomplish. The Act charges the Federal Reserve Board with setting up a searchable database of credit card agreements for consumers containing credit card agreements from all the major card issuers in a format that enables cardholders to compare agreements across card issuers.

In compliance with the new law, the Fed recently launched the new, much awaited database. And undoubtedly, with currently 1,235 agreements from nearly 300 issuers, the site is indeed a “database.” However, how “searchable” and to what extent the site is actually of any use “for consumers” is a matter of some debate.

Reviewers of the site, however, have expressed dismay over its organization. While the card agreements may be posted on the site, it is questionable how accessible the information in these is. For starters, searches turn up only links to text, as opposed to text itself. Furthermore, the linked text does nothing to indicate the card returned; instead it lists the size of the downloadable PDF and the word “TEXT.” The issuer name appears nearby, but since many large issuers offer dozens of credit cards, this information is of little help for consumers looking to compare.

Worse, the PDF files links to the full card agreement, leaving website visitors to search through the entire agreement to find the information needed. Further, the search mechanism that enables users to search across credit card agreements leaves much to be desired: searches for “no annual fee” turn up the exact same “276 consumer agreement(s) from 56 issuers” that searches for “annual fee” do. In short, without readily visible text to scan terms, visitors to the Fed’s new database are left having to open and read through the terms of 276 PDF files to compare terms across 56 card issuers. Helpful indeed.

The site offers no compare function; searchers who want to contrast one card against another will have to do so manually. Credit card websites like CreditCardGuide.com and Bankrate.com offer far more tools for personalized card selection and comparison in an easily accessible and easy to use format. Many card applicants will prefer searching for credit card deals through more functional means, such as the credit card comparison tools offered on CreditCardGuide.com.

The new Fed database of credit card agreements does offer consumers a chance to become familiar with issuers they might have otherwise remained unaware of, such as little known credit unions or small, local banks. Be aware, however, that not all issuers are included in the database; those with less than 10,000 accounts were not required to submit their cardholder agreements.

Fortunately, the Credit CARD Act also stipulated that card issuers should post all credit card agreements on their websites, so people looking for the specific terms of their existing credit card agreement are better off going straight to their card issuer’s website. Card issuers are also required to make printed copies of the agreement available to cardholders who request them. And of course, to save yourself some time, should you have questions about specific terms of your credit card agreement, the easiest recourse still is to simply call your card issuer and ask.