Fed Rule Would Restrict Credit Cards for Some Consumers; Women's Rights Issue

The Credit Card Act signed into law last year was supposed to stop financial institutions from sleazy antics. But instead, some retailers say, it may restrict stay-at-home moms.

Dress Barn Inc., Home Depot Inc., Citigroup Inc. and other companies are urging the Federal Reserve to drop a proposed rule that would require credit-card issuers to consider only a borrower's "independent" income rather than household income. The new standard, which would apply to new credit-card accounts and requests to increase limits on existing accounts, could make it difficult for some customers to get credit on the spot, especially stay-at-home moms.

The proposed rule "would unfairly restrict the ability of many consumers, particularly women not working outside the home, to qualify for credit," wrote David Jaffe, president and chief executive of Dress Barn in a letter to the Fed this month. The company operates 2,477 stores for women and young girls.

Retailers have long enticed customers with store-branded credit cards that offer discounts or other perks. The cards have become a valuable marketing tool and a real-time window into the spending habits of customers.

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