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#204813 - 06/25/04 09:39 PM business credit card applications
Anonymous
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We are working on a new business credit card application.... What do we need to watch out for from a regulatory standpoint. Reg Z does not apply and we do not have to have disclosures on the application, right?

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General Discussion
#204814 - 06/25/04 10:46 PM Re: business credit card applications
Mollie Sudhoff Offline
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Mollie Sudhoff
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Winnetka, Il, USA
Reg Z does apply to business "credit cards". See 226.1(c)(2). Also, you may wish to review Section 135 of the TILAct. In particular, Issuance, liability and Fraudulent use of credit cards is the same for business users. The only exception is where issuance is to a business for use by 10 or more employess. Even then liability may not be increased. Hope this is helpful. Good luck.
MNS
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#204815 - 06/28/04 02:02 PM Re: business credit card applications
Anonymous
Unregistered

Does reg Z apply for disclosure requirements on the credit card application such as the 18 font type for the APR????
Help..

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#204816 - 06/28/04 02:22 PM Re: business credit card applications
Andy_Z Offline
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Certain sections reference business use, such as 226.12. 226.5a references a 12-point type as being clear and conspicuous. I don't believe this has the business requirement but haven't worked with cards in a long time. I also don't recall an 18 point type size requirement for the APR.
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#204817 - 06/28/04 05:05 PM Re: business credit card applications
NotALawyer Offline
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NotALawyer
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Also make sure you collect the applicant's TIN. This will be necessary to report to the IRS if you write off more than $600 in debt from the cardholder.

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#204818 - 06/28/04 06:48 PM Re: business credit card applications
Anonymous
Unregistered

the 18 point font is in the latest revision to Reg Z and became effective Oct. 1, 2001.

See 226.5a Credit and charge card applications and solicitations. Specifically, 226.5a (b)(1) Annual percentage rate. Each periodic rate that may be used to compute the finance charge on an outstanding balance for purchases, a cash advance, or a balance transfer, expressed as an annual percentage rate (as determined by 226.14(b)). When more than one rate applies for a category of transactions, the range of balances to which each rate is applicable shall also be disclosed. The annual percentage rate for purchases disclosed pursuant to this paragraph shall be in at least 18-point type, except for the following: a temporary initial rate that is lower than the rate that will apply after the temporary rate expires, and a penalty rate that will apply upon the occurrence of one or more specific events.

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#204819 - 06/29/04 12:46 AM Re: business credit card applications
Andy_Z Offline
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Thanks for the cite. And more so for the fact that I see CCH won't detect "18" as being in that cite.
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AndyZ CRCM
My opinions are not necessarily my employers.
R+R-R=R+R
Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell

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#907359 - 02/20/08 04:43 PM Re: business credit card applications Andy_Z
QCL Offline

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QCL
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NW IL
Sorry to bring this back from the way-way back time machine...
but would the 18 point font requirement apply to business applications?

Or wait a minute, was the 18 point requirement taken out?

I'm confused.

On a business credit card application do any of you have the APR stand out?
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#907564 - 02/20/08 07:08 PM Re: business credit card applications QCL
RR Joker Offline
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I don't see where they even specify the size requirement anymore...they have many examples of "conspicious" in the commentary. I would say that, as far as I can tell, the "conspicious" requirements outlined would apply to all credit-card apps
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#907925 - 02/21/08 01:24 AM Re: business credit card applications RR Joker
Andy_Z Offline
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The cite above, 226.5a(b)(1) still references an 18 point type.

http://www.bankersonline.com/regs/226/226-5a.html
_________________________
AndyZ CRCM
My opinions are not necessarily my employers.
R+R-R=R+R
Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell

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#908351 - 02/21/08 07:01 PM Re: business credit card applications Andy_Z
RR Joker Offline
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The Swamp
Sure does...glad it wasn't a snake! I know ours is huge, but wasn't sure of the exact size. Probably a dang 26, if I had to guess.
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#908937 - 02/22/08 04:43 PM Re: business credit card applications QCL
banjo Offline
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Posts: 286
In section 226.3 it states Reg Z does not apply to business, commercial, agricultural, or organziational credit. However, there is a footnote #4 that states the provisions in sections 226.12(a) and (b) governing the issuance of credit cards and the liability for their unauthorized use apply to all credit cards, even if the credit cards are issued for use in connection with extensions of credit that otherwise are exempt under the section.

As the credit card application disclosure requirements are under 226.5a, I don't think the 18 point size applies to business cards. The only requirements are under 226.12(a)&(b).

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