Discussion Paper

Mandatory arbitration clauses in the credit card industry

Abstract: On September 26, 2002, the Payment Cards Center of the Federal Reserve Bank of Philadelphia held a workshop that explored the use of mandatory arbitration clauses in credit card agreements between issuers and consumers. Leading the workshop was Alan S. Kaplinsky, chair of the Consumer Financial Services Group at Ballard Spahr Andrews & Ingersoll, LLP. A pioneer in the development of consumer arbitration clauses, Kaplinsky described the arbitration process as a conflict resolution mechanism in the payment cards industry. He also provided a contextual overview of the Federal Arbitration Act of 1925, subsequent legislative actions, and relevant court cases. This paper summarizes his presentation and the ensuing discussion with workshop participants.

Keywords: Credit cards;

Bibliographic Information

Provider: Federal Reserve Bank of Philadelphia

Part of Series: Consumer Finance Institute discussion papers

Publication Date: 2003

Number: 03-01