In recent months, several of the largest credit card issuers have begun the process of transitioning customers who carry fixed rate credit cards to variable rate cards. Does this mean that the days of fixed rate credit cards are near an end?

Perhaps not yet, but the writing is on the wall. As this LA Times column points out, the impending enactment of the Credit Card Accountability, Responsibility and Disclosure Act could explain why banks are acting now.

The new law, which was signed in May, with most of its provisions taking effect in February 2010, makes it much more difficult for issuers to change interest rates unless the card has a variable rate. For example, under the new rules, interest rates can’t be changed during the first year after a card is issued. The exception is if the card has a variable rate. In addition, the interest rate on existing balances also can’t be raised, unless the card carries a variable rate at the time the law takes effect.

The fact of the matter is that under the new rules, fixed rate credit cards are much riskier products for issuers. With the card industry facing mounting losses and chargeoffs, coupled with the specter of the recently proposed Consumer Financial Protection Agency, that makes the future of fixed rate cards uncertain at best.