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The Consumer Financial Protection Bureau is poised to crack down on what it calls insignificant fees, late payment fees, hotel vacation fees, and other related expenses that collectively add billions of dollars to what Americans pay for goods and services.
“Insignificant fees make it difficult for us to choose the best product or service, as the true cost is hidden,” bureau director Rohit Chopra said at a press conference on Wednesday as the bureau was launched. a request for general comment about the use of such fees. Such a request is the official first step in the long process of creating new rules for financial service providers.
Mr. Chopra said his agency is particularly interested in areas where providers operate as key pitches – for example, the $25 to $35 fees many credit card companies charge for delayed payments, which cuts them off. estimated $14 billion annually. Balance transfer fees are another focus: Consumers transferred $35 billion in 2020, charging an average of around 3 percent.
Bureau officials also cited service fees charged by concert ticket providers and resort fees charged by hotels as areas of concern.
The trivial fee request is the consumer bureau’s latest move to focus on user fees. In December, the agency released a report on the $15 billion per year that banks collect. overdraft and insufficient funds fees. Under regulatory pressure, banks take them back: Bank of America recently said it would cut its fee from $35 to $10, and Capital One and Ally Financial eliminated theirs entirely.
Mr Chopra said on Wednesday these changes were “progress, but not enough”.
The agency has set a deadline of March 31 for comments on supposedly insignificant fees. Bureau officials said they intended to move to rulemaking quickly, but also noted that the issue will likely remain a focus throughout Mr. Chopra’s five-year tenure, which is scheduled to run into 2026.
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