What is a credit card arbitration clause?

A credit card arbitration clause is a clause included in a credit card agreement that states that any dispute between the cardholder and the credit card issuer must be resolved through arbitration. This clause is advantageous for the credit card issuer as it prevents cardholders from filing a lawsuit against the company, which can be time-consuming and costly to the credit card issuer. In South Carolina, credit card arbitration clauses are enforced by the Federal Arbitration Act. This act provides that any dispute between a cardholder and a credit card issuer must first be decided through arbitration, which is a process in which a neutral third-party, known as an arbitrator, listens to both sides of a dispute and makes a ruling based on the evidence presented. The arbitrator’s decision is binding, meaning that it is legally-binding and enforceable. This process is often faster and less expensive for both parties than going to court, which is why credit card issuers often prefer to use this process to resolve disputes with their customers. Additionally, the process is confidential, meaning that the details of the dispute are kept private and not made available to the public. Overall, a credit card arbitration clause is a clause that requires disputes between a cardholder and a credit card issuer to be resolved through arbitration. This process offers numerous advantages to both parties involved, including faster dispute resolution and privacy.

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What is a credit card arbitration clause?

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