Bill C-402
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SUMMARY |
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The purpose of this enactment is to limit interest rates on credit card
accounts. Thus, credit cards issued by a petroleum company or a retail
store could not carry interest at a rate exceeding by more than 9.5% or
11.5% respectively the Bank of Canada discount rate. Those issued by
a financial institution could not carry interest at a rate exceeding by
more than 6.5% or 8.5% the Bank of Canada discount rate, depending
on whether or not such institution charges entry fees, renewal fees or
user fees.
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Another purpose of this enactment is to provide for a grace period for
partial payments in relation to a credit card account. Thus, the part of a
purchase that is paid on the due date is treated as a delayed cash payment
while only the remaining balance bears interest. The card holder has a
grace period from the date of purchase to the date of partial payment.
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