New Jersey Statutes 17:3B-29. Findings, declarations relative to bank revolving credit plans
Terms Used In New Jersey Statutes 17:3B-29
- Litigation: A case, controversy, or lawsuit. Participants (plaintiffs and defendants) in lawsuits are called litigants.
- National Bank: A bank that is subject to the supervision of the Comptroller of the Currency. The Office of the Comptroller of the Currency is a bureau of the U.S. Treasury Department. A national bank can be recognized because it must have "national" or "national association" in its name. Source: OCC
- Revolving credit: A credit agreement (typically a credit card) that allows a customer to borrow against a preapproved credit line when purchasing goods and services. The borrower is only billed for the amount that is actually borrowed plus any interest due. (Also called a charge account or open-end credit.) Source: OCC
- State: extends to and includes any State, territory or possession of the United States, the District of Columbia and the Canal Zone. See New Jersey Statutes 1:1-2
(1) Interest that can be charged by issuers of bank credit cards may depend on the laws of the state under which a bank is chartered or in which a federally chartered bank has its principal office, or the laws of the state where such bank has a branch office;
(2) The United States Supreme Court has held, in accordance with the provisions of federal law, that a national bank issuer of a bank credit card can export the rate of interest allowed in its home state to other states, and this holding is now equally applicable to national and state banks;
(3) There has been significant and expensive litigation concerning the extent to which certain related charges constitute part of the exportable rate of interest, but federal and state courts and the Comptroller of the Currency have taken the expansive view that related charges constitute a part of the exportable rate of interest; and
(4) Consequently, issuers of bank credit cards have located and continue to locate in states which have the least restrictive laws regarding interest and related charges.
b. Therefore, the Legislature proposes to simplify State law with respect to interest on bank credit cards to make this State as equally attractive as other states for the location of bank credit card operations.
c. Moreover, since the rules applicable to revolving credit plans have been the subject of disputes by courts and regulators; since the New Jersey Department of Banking and Insurance has advised New Jersey-based banks that under State parity law there are no limits on late fees and related charges; and since any retroactive application of restrictions would impose upon New Jersey-based banks a competitive disadvantage, the Legislature proposes to “level the playing field” for New Jersey-based banks and to preclude potentially costly litigation by permitting this act to apply to all revolving credit plans entered into before and after the effective date of this act.
L.1996,c.137,s.1.