WASHINGTON—The CFPB has announced a 10-day extension on its deadline for its advance notice of proposed rulemaking (ANPR) inviting comment on questions related to credit card late fees that financial institutions, including credit unions, collect.
According to the Bureau, the ANPR is an effort to sharply reduce the $12 billion financial institutions collect in credit card late fees each year.
NAFCU, CUNA and several trade associations in June wrote to the CFPB requesting a 60-day extension on the Bureau’s deadline for its ANPR comment period. The groups stated that part of the request is due to the ANPR’s unexpected nature, given that the CFPB regulatory action on fees was not included in its spring 2022 regulatory agenda, which was published before the ANPR was announced.
NAFCU also sent members a Regulatory Alert seeking feedback on the CFPB’s ANPR.
Three Points Highlighted
In the Regulatory Alert, NAFCU said it sought to highlight:
- The CFPB is seeking information to determine whether credit card late fees charged by credit meet the “reasonable and proportional” standard set by the Credit Card Accountability Responsibility and Disclosure Act, implemented by Regulation Z
- The Bureau evaluates lates fees by considering costs incurred by card issues, late fees’ deterrent effect, cardholder behavior, along with other factors
- The CFPB’s data show consumers paid approximately $12 billion in credit card late fees in 2020, with an average first-time late payment fee of $26
Comments are due to the CFPB Aug. 1.