WASHINGTON -- Congress is seeking to aid consumers through tighter regulation of the credit-card industry.

Targeting “wild interest rate hikes,” “extreme penalties” and other practices, Sen. Robert Menendez (D-NJ), introduced a credit-card reform proposal last week that he said would protect consumers from abuses, MarketWatch reports.

A report last year found that about one-third of cardholders pay interest rates of more than 20%. The Credit Card Reform Act would take steps such as limiting interest-rate increases to a seven percentage point rise and prohibiting “universal default,” a practice in which the issuer increases rates when cardholders don’t make payments to other creditors or have an overall decline in their credit score.

Travis Plunkett, legislative director of Consumer Federation of America, said credit-card companies should be stopped from “using traps and tricks to unjustifiably raise fees and interest rates.”

On Thursday, House lawmakers will hear from consumers, experts and industry participants on a separate credit-card proposal. Last month Rep. Carolyn Maloney (D-NY), introduced the Credit Cardholders’ Bill of Rights Act that would take actions such as protecting cardholders against arbitrary interest-rate increases and requiring Congress to provide better industry oversight. Maloney’s proposal sets neither rate caps nor price controls.

Maloney, chairwoman of the House Financial Services Subcommittee on Financial Institutions and Consumer Credit, said the “playing field between card companies and cardholders has become very one-sided” in recent years.