Colorado Legislative Council Staff

NO FISCAL IMPACT

TITLE:            CONCERNING THE REDUCTION OF THE MAXIMUM RATE OF INTEREST ALLOWED TO BE CHARGED ON CREDIT CARDS.

Summary of Assessment

            The provisions of this bill would reduce the maximum credit service charge allowed to be imposed on the following consumer credit transactions:

            •   sales made pursuant to a seller credit card, from 1 3/4 percent to 1 1/4 percent;

            •   maximum loan finance charge imposed on a loan pursuant to a lender credit card, from 20 percent to 15 percent; and

            •   maximum loan finance charge imposed on a purchase of goods and services using a lender credit card, from 18 percent to 12 percent, when the lender does not provide a twenty-five day grace period for the payment of charges for such goods and services.

            The bill would become effective upon signature of the Governor.

            The provisions of this bill would apply only to credit cards issued in this state. The Divisions of Banking and Financial Services, Department of Regulatory Agencies, currently examine state banks and other state financial institutions to ensure compliance with state regulations. The examination procedures would be modified to review for compliance. The provisions of this bill would not have any fiscal impact on the divisions, or any other agency of the state, or unit of local government. Therefore, this bill is assessed as having no fiscal impact.

Departments Contacted

            Law    Regulatory Agencies