Business Groups Oppose CFPB Plan to Cut Credit Card Late Fee Limit

A coalition of 30 groups sent a letter to Biden opposing the CFPB's proposal to reduce the credit card late fee safe harbor from $41 to $8.

The groups argue the new rule will harm consumers, small businesses, and economic growth by leading to higher interest rates and reduced credit access.

The groups say late fees help cover costs and the CFPB overestimated potential consumer savings.

Critics say while late payers benefit, responsible payers will face higher costs due to banks offsetting lost revenue.

Some argue the CFPB lacks authority from Congress to issue the new rule, which could spur litigation.