CFPB Proposes Lowering Credit Card Late Fees
Protecting Consumers and Promoting Fairness
The Consumer Financial Protection Bureau (CFPB) has proposed amendments to Regulation Z, aiming to ensure the reasonableness and proportionality of late fees imposed by credit card companies.
The proposed rule seeks to revise the existing framework by lowering the maximum late fee amount and implementing a number of additional protections for consumers.
Specifically, the CFPB proposes to amend Section 1026.52(b)(1)(ii) of Regulation Z to reduce the maximum late fee that can be charged from $30 to $10 for accounts with a balance of $500 or less, and from $41 to $15 for accounts with a balance greater than $500.
This change is intended to make late fees more proportional to the cost of processing late payments, while also providing relief to consumers who may be struggling financially.
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