Credit cards might only charge a $8 late fee from now on, thanks to a new regulation.
A credit card cap of $8 is a lot less than the $32 late fee that most people have to pay. These charges are known as “junk fees” by the White House. A new rule from the Consumer Financial Protection Bureau will limit them to $8. If banks want to, they can show proof that they should charge more than the existing limit.
President Joe Biden had said before that he would get rid of junk fees in 2023 because he thought they were “unfair.” Every year, buyers pay about $90 billion in unnecessary fees because of junk fees.
Rohit Chopra, head of the CFPB, said, “Consumers are hit with junk fees and have to navigate a market controlled by a small group of powerful players in credit cards, as in many other areas of the economy today.”
Along with this new rule, Biden is also putting together a new strike team whose job it will be to fight unfair or illegal prices on things like food, medicine, housing, and healthcare. There is a lot of stress because inflation is still high compared to prices before the pandemic, even though it is lower than it was during the pandemic.
The head of the National Economic Council, Lael Brainard, said, “President Biden is in the fight for the long haul when it comes to lowering prices for American consumers.”
According to an analysis, Biden’s ideas for the economy and prices would get rid of $20 billion a year in junk fees.
Americans are getting more and more worried about their high bills and credit card debt. Credit card debt has just hit an all-time high. People in the US don’t pay their bills on time, which causes late fees and high interest rates.
