Nearly $30 Billion in Punitive Fees
How banks and credit card companies bilk consumers instead of offering better service
Today, the Consumer Financial Protection Bureau (CFPB) issued a request for information on late and junk fees charged by banks and credit cards. The move is an effort to begin the process of designing protections for consumers in the credit and banking industries.
In making the announcement, the CFPB indicated that industry reform could save consumers billions of dollars each year.
“Many financial institutions obscure the true price of their services by luring customers with enticing offers and then charging excessive junk fees,” said CFPB Director Rohit Chopra. “By promoting competition and ridding the market of illegal practices, we hope to save Americans billions.”
Fee Economy
The CFPB derided what it labels a “fee economy” that has banks and credit card companies earning billions in profits from punitive fees rather than competing on better service.
Companies across the U.S. economy are increasingly charging inflated and back-end fees to households and families. This new “fee economy” distorts our free market system by concealing the true price of products from the competitive process.
