On March 5th, the Consumer Financial Protection Bureau issued its final rule on credit card late fees. The rule amends Regulation Z by significantly reducing the safe harbor that credit card issuers can charge for credit card late payments to $8. The rule applies to issuers with more than one million credit card accounts, however, America’s Credit Unions and the Nebraska Credit Union League suggest that all credit card issuers will be impacted and all consumers will be impacted with higher costs and fewer credit options. “The CFPB believes that this rule will help the financially vulnerable, but it could inflict greater financial harm to those very people by pushing them to the largest credit card issues that will have lower late fees due to this rule but much higher interest rates,” said Brandon Luetkenhaus, Chief Advocacy Officer at the League. “It could also dry up available credit for those very same people,” said Luetkenhaus.
