Definition
A cardholder agreement is a contract between a credit card issuer and a consumer governing use of a credit card account.
Analysis
A cardholder agreement details the terms of use for the account, restrictions on use of the account and repercussions of failure to honor terms of the agreement. An applicant will receive a complete cardholder agreement after they have applied for a credit card account.
A consumer may read the cardholder agreement prior to activating the credit card that they have received. They may refuse to activate the card account if they do not consent to the terms of the cardholder agreement.
The card issuer reserves the right to modify the cardholder agreement at any time by simply mailing notice of revisions to the cardholder agreement. Modifications are automatically enforced unless the cardholder objects to the changes, usually within 30 days.
A cardholder that does not consent to proposed changes may protest the changes, and can generally keep the original terms until the card balance is repaid.
