Regulator proposes capping credit card late fees at $8, latest in Biden campaign against 'junk fees'
The Biden administration is moving to cap credit card late fees at $8
NEW YORK — The Biden administration announced a rule Tuesday to cap all credit card late fees, the latest effort in the White House push to end what it has called “junk fees" and a move that regulators say will save Americans up to $10 billion a year.
The Consumer Financial Protection Bureau's new regulations will set a ceiling of $8 for most credit card late fees, or require banks to show why they should charge more than $8 for such a fee.
The rule would bring the average credit card late fee down from $32. The bureau estimates banks brought in roughly $14 billion in credit card late fees a year.
“In credit cards, like so many corners of the economy today, consumers are beset by junk fees and forced to navigate a market dominated by relatively few, powerful players who control the market,” said Rohit Chopra, director of the bureau, in a statement.
President Joe Biden planned to highlight the proposal along with other efforts to reduce costs to Americans at a meeting of his competition council on Tuesday. Biden is forming a new “strike force” to crack down on illegal and unfair pricing on things like groceries, prescription drugs, health care, housing and financial services.
The strike force will be led by the Justice Department and the Federal Trade Commission, according to a White House statement.
The Biden administration has portrayed the White House Competition Council as a way to save people money and promote greater competition within the U.S. economy.
The White House Council of Economic Advisers produced an analysis indicating that the Biden administration’s efforts overall will eliminate $20 billion in annual junk fees. The analysis found
Read more on abcnews.go.com
