Final answer:
The Credit Card Act of 2009 mandates that individuals under 21 must have an adult co-signer or sufficient income to be eligible for a credit card. This act was implemented as a response to rising credit card debt and to safeguard young adults from financial missteps.
Step-by-step explanation:
According to the Credit Card Act of 2009, credit cards cannot be issued to individuals under the age of 21 unless they have an adult co-signer or can show proof that they have enough income. This legislation was part of a broader effort to address issues within the financial system, which included problems such as consumers accumulating significant amounts of debt and financial institutions issuing high-risk loans.
The context of rising credit card debt, which had reached over $1 trillion by 2008, highlighted the necessity for such regulations. The Act was intended to prevent young adults from incurring unmanageable levels of debt due to their foray into credit without adequate understanding of the responsibilities and consequences that come with managing credit. It requires younger individuals to either demonstrate sufficient income to cover their credit expenses or to have a responsible adult co-sign the credit agreement, ensuring that there is a safety net to avoid financial pitfalls.