By Phil Wahba

NEW YORK, March 30 (Reuters) – Top retailers have sounded the alarm about the U.S. government’s recently enacted credit card reforms, warning investors the new rules will hit their bottom lines to the tune of millions of dollars just as consumer spending is beginning to bounce back.

Last year, the U.S. government passed the consumer friendly Credit Card Accountability, Responsibility and Disclosure Act, or Credit CARD Act for short. Its provisions include a ban on arbitrary interest rate increases on credit card debt and requires penalty fees to be proportionate to a cardholder’s violation.

“We understand there was a great desire for credit card reform,” said Mallory Duncan, the National Retail Federation’s general counsel. Yet he said the new rules only codified what many retailers were already doing, such as limiting fees on gift cards.

Retailers say the new rules can hurt profits, but have to grin and bear it as a small price to pay for the benefits cards provide, such as luring potential shoppers with rewards programs and revealing valuable data about customer habits.

Most credit cards are issued by banks, which led the charge in lobbying Congress as the act was being crafted, but many retailers also offer shoppers store-branded cards, which they say is crucial to wooing shoppers, especially now.