Biden Administration Caps Credit Card Late Fees At $8

NPR reports:

The cost of a late payment on your credit card could soon be going down. Federal regulators issued a new rule Tuesday capping credit card late fees at $8, down from the current average of $32. The move is expected to save customers $10 billion a year.

Consumer advocates praised the measure as providing welcome relief for millions of credit card users, but business interests accused regulators of overstepping their authority and promised legal action to prevent the rule from going into effect.

NBC News reports:

In a statement, Rob Nichols, the president and CEO of the American Bankers Association, called the proposal “flawed,” arguing it could actually result in more late payments and ultimately lower credit scores. It could also have a knock-on effect for card users who do pay what they owe on time, Nichols said.

“The Bureau’s misguided decision to cap credit card late fees at a level far below banks’ actual costs will force card issuers to reduce credit lines, tighten standards for new accounts and raise APRs for all consumers — even those who pay on time,” Nichols said.

Difference between @SenateDems @HouseDemocrats and @SenateGOP @HouseGOP , Democrats approve laws to protect the middle and lower class. The GOP votes against capping the cost of Insulin. Here’s another win for middle and lower income Americans. https://t.co/dGpN7fj26K

— Trent Edwards (@Trent_99er) March 5, 2024