Among them: payment allocation. Banks generally allocate customer payments to the balance with the lowest interest rate. For a cardholder with a balance of $3,000, a payment of $1,500 would be applied entirely to pay down a low-rate balance transfer before it paid down more expensive loans, like cash advances or purchases. This negates the benefit of the promotions, the Fed found.

Its proposal would require that card companies allocate payments more favorably, such as spreading the money around or paying it down in proportion to the size of the debt. This will cost them revenue and "may in turn lead institutions to increase rates generally or offer less favorable promotional rates or fewer deferred-interest plans," the Federal Reserve said.

Policies like these have made credit-card lending one of the most profitable businesses in banking, producing far greater returns on assets than other kinds of loans, according to the Fed. The average return on assets of all commercial banking was 1.94 percent in 2005, compared with the 2.85 percent return reported by large credit-card issuers.

Between 1990 and 2004, industry profits on a $100 balance grew 57 percent, to $3.61 annually from $2.30, according to a congressional report. Revenue from penalty fees on a $100 balance doubled during the same period.

Card-industry critics cheered the new rules. "This is really comprehensive and what consumer groups have been hoping for," said Ellen Cannon, the managing editor of Bankrate.com.

The Fed would also end a practice called universal default, in which banks jack up interest rates—sometimes doubling them—on outstanding credit-card balances when borrowers have problems with unrelated debt like a utility bill.

Consumer advocacy groups have long lamented this policy and appear to have finally won over regulators.

Cardholders "want to be blamed for the mistakes they make with their credit card, not with everything else," Cannon said.

Under the proposal, increases on balances would be limited to times when a cardholder falls more than 30 days behind on a minimum payment.

The Fed acknowledged that the policy "could lead to higher up-front costs and less available credit to consumers."