WASHINGTON—The Consumer Financial Protection Bureau is seeking public comment on how the credit card market is functioning and the impact of credit card protections on consumers and issuers.
The request comes before the bureau conducts its mandatory two-year review of the consumer credit market, as directed by the CARD Act.
The public inquiry focuses on issues including credit card terms, the use of consumer disclosures, credit card debt collection practices, and rewards programs, among others, the CFPB stated.
“With today’s inquiry, the bureau is seeking to further understand how the credit card market is working in practice and how credit card protections affect consumers and credit card issuers,” said CFPB Director Richard Cordray. “As we undertake this review, the bureau wants to ensure it understands the information that consumers, industry, advocates, and other stakeholders believe is most relevant.”
The CFPB noted that the CARD Act was passed with the goal of bringing “fairness and transparency to the credit card market . . . With today’s Request for Information, the CFPB is seeking to gather more information on how the credit card market is functioning and the continuing effects of the CARD Act on consumers,” the agency stated.
Some of the specific areas the CFPB is requesting information on include:
- The terms of credit card agreements and practices of credit card issuers: The bureau wants to know how the terms and conditions of credit card agreements may have changed since it conducted its review of the credit card market two years ago. The CFPB is looking to see how card issuers may have changed their pricing, marketing, underwriting, or other practices and whether those changes have benefited or harmed consumers, the agency stated.
- Unfair or deceptive acts or practices in the credit card market: The bureau is looking for information on the extent to which unfair or deceptive acts and practices, or unlawful discrimination, may still exist in the credit card market and with what frequency and effect on consumers.
- Debt collection practices within the credit card industry: The CFPB is looking for information on the collection of past due amounts on credit card accounts as well as debt collection practices within the credit card industry, the agency stated. Other areas the CFPB is seeking input on include how often card issuers use third-party collection agencies and how those relationships are managed.
- Consumer understanding of rewards products: The bureau is looking for information on how credit card issuers determine that their disclosures for rewards products are being made in a clear and transparent manner, whether consumers understand these offers when applying for rewards credit cards, and how disclosures may be improved to benefit consumers.
Comments on the Request for Information are due within 60 days after publication in the Federal Register.