Biden Proposes Cap on U.S. Credit Card Fees to Save Consumers $9 Billion

February 7, 2023 FinTech and Alternative Finance, Fintech Services, Innovation and Resources, Leadership, Productivity, Competition, Human Capital, Health, Legal Issues, Regulation, Consultation, Stories No comments

Reuters | Douglas Gillison and David Shepardson | Feb 1, 2023

Image: Freepik/flaticon

President Joe Biden on Wednesday unveiled fresh efforts to slash credit card late fees and drive down the prices that Apple Inc and Google parent Alphabet Inc charge on mobile app stores.

Speaking at the White House, Biden also called on lawmakers to ban "junk fees" he said jacked up costs for consumer services such as accommodation, concert tickets, mobile plans and air travel, in which officials said air carriers can charge family members extra to be seated next to young children.
- The move is part of a larger policy drive to promote competition in consumer markets, officials said.
- Biden, The bottom line is these unfair fees add up. It's a basic question of fairness

See: CFPB: US Consumer Agency Announces Open Banking Rule

As part of the initiative, the Consumer Financial Protection Bureau on Wednesday proposed a rule to ban "excessive" fees that credit card issuers charge for late payments, something the bureau estimated costs consumers $12 billion a year.
- The CFPB said the rule would cap late fees at $8, whereas officials estimate they currently average $31, something that could represent as much as $9 billion in consumer savings a year.

Apple response:

An Apple spokesperson said in a statement that while the report "acknowledges the importance of user privacy, data security and user convenience," some of its conclusions "ignore the investments we make in innovation, privacy and security."

See: Someone Just Sent $1 Billion in Bitcoin, Paid Only $3 in Fees

Google response:

Google also disagreed with the report's findings, saying through a spokesperson that its Android system "enables more choice and competition than any other mobile operating system."

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