New credit card rules announced in Canada

TORONTO, May 21 (UPI) -- Canada's Conservative finance minister Thursday announced new regulations for credit card issuers, but stopped short of interest rate caps.

At a news conference in Toronto, Finance Minister Jim Flaherty said it was decided not to cap interest rates as consumers had a wide choice of options in selecting their credit cards, the Canwest News Service said.

Among the nine changes to credit laws was a provision that companies give consumers a 21-day interest-free grace period on new purchases, the Canadian Broadcasting Corp. said.

"This is a major change that was resisted by financial institutions," Flaherty said. "It will cost them tens of millions of dollars a year."

Another change was that customer statements must show how long it would take to pay off the entire balance if only minimum payments were made, Canwest said. The new rules also mandate credit limits can't be automatically raised without the consent of the cardholder, the report said.