Small Businesses Want to Ensure Coverage Under Credit Card Bill

"America's small businesses are struggling to keep their doors open and are looking to Washington for help," stated NSBA President Todd McCracken. "Enacting the Landrieu-Snowe Amendment will send a strong message to the 26.8 million small businesses in this country that they are more than just a talking-point, that Members of Congress believe in their unique ability to create jobs and grow the economy, and that they will do whatever they can to help."

Although the credit cards of many--if not most--small-business owners are based on the individual owner's personal credit history, it is conceivable that issuers could legally consider them exempt from the Credit CARD Act's vital protections. This is because the bill amends the Truth in Lending Act (TILA), which for the most part applies only to "consumer" and not business transactions.

While a small-business owner who opens a personal credit-card account and uses it occasionally for business should be covered under TILA, it is unclear whether or not this legislation would protect a small-business owner who used his or her card exclusively or even primarily for business purposes. Eighty-six percent of respondents to the NSBA Survey reported using their consumer or business credit-cards primarily or exclusively for business purposes.

In addition to ensuring that the cards used by small-business owners are covered, the Landrieu-Snowe amendment would increase TILA's exemption of cards with credit limits of $25,000 or more to cards with limits of $50,000 or more. Fifty-two percent of respondents to the NSBA Survey reported having a credit card limit of $25,000 or more, essentially eliminating them from any of the protections of the Credit CARD Act of 2009 without the Landrieu-Snowe Amendment.