CFPB looks to increase card competition

Federal Issues CFPB Consumer Finance Credit Cards Competition CARD Act

On April 17, CFPB Director Rohit Chopra said the Bureau is focused on finding ways to increase competition and reduce costs as credit card debt continues to rise and interest rates increase. Chopra discussed a proposal announced in February (comments are due May 3), which would ensure that late fees on credit cards accounts are “reasonable and proportional” to late payments as required under the Credit Card Accountability Responsibility and Disclosure Act of 2009 (covered by InfoBytes here). He also discussed updates made in March to the Bureau’s terms of credit card plans (TCCP) survey and database, which are intended to help consumers comparison shop for credit cards and find the best interest rates and products (covered by InfoBytes here). The refreshed TCCP survey allows issuers to voluntarily submit information about their credit card products and requires the top 25 credit card issuers to provide information on all their credit cards instead of just their most popular products, Chopra explained, stating that the initiative is designed to help smaller credit card issuers reach comparison shoppers and compete with bigger players in the market. Chopra also touched upon other initiatives, such as an ongoing review of the consumer credit card market and an examination focusing on large credit card issuers’ suppression of key data from consumer credit reports.