CAMBRIDGE, Mass. (7/9/09)--Two Harvard researchers, using their independent research, extolled the virtues of credit unions' credit card practices in an op-ed item in The New York Times (June 23). The article, by doctoral students Ryan Bubb and Alex Kaufman, pointed out that the credit card industry says the Credit Card Accountability, Responsibility and Disclosure (CARD) Act "spells the end of the credit card as we know it." However, credit unions' example "puts the lie to these claims. Credit unions conform to the new rules already, while profitably maintaining the basic features that users know and love," they wrote. They conducted a study that compared credit cards issued by banks and those issued by credit unions. "We found that credit unions are less likely to charge the fees and penalties that the new act hopes to eliminate--and when they do, they charge less than other issuers." They also found that credit unions do not increase the interest rate if the borrower fails to make a minimum payment on time, they charge on average half the amount other issues charge for exceeding credit limits, and they offer lower annual fees and longer grace periods than other cards. Credit union cards "are a great test case for how regular cards will perform under the new law," Bubb and Kaufman wrote, warning, "Any bank that attempts to pad its bottom line by, say, levying large annual fees will likely see its customers flee to credit unions or to banks that emulate the credit union model." "Credit union cards demonstrate that punishing fees are not an essential ingredient of profitable lending. This should help assuage fears that the credit card act will bring disaster for credit cards. Rather, it should nudge them toward the gentler credit union model that many Americans already enjoy." Reacting to the study, Brett Thompson, president/CEO of the Wisconsin Credit Union League, said in a press release that because the new law will send many banks scrambling to devise new ways to drive profits, it's still up to bank customers to understand the terms of their cards, read the fine print and be vigilant to protect their own interests. "This study supports what we have always said," Thompson said. "Wisconsin credit unions look out for the best interests of their 2.2 million member owners, not just protecting them from unnecessary costs for credit cards but also on savings, loans, checking accounts, ATMs and just about every other financial service working people use." The league provided several media spots about the survey featuring Chris Henzig, league director of communications, explaining the study's results.