Consumer Financial Protection Bureau wants to reverse ban on high credit card fees
The Consumer Financial Protection Bureau on Thursday proposed reversing a ban on exorbitant credit card sign-up fees, frustrating consumer groups and raising questions about the scope of the agency’s authority.
At issue are “fee-harvester cards” that are targeted at consumers with poor credit histories. The cards typically come with low limits, high fees and interest rates of up to 36 percent.
Congress tried to rein in those costs three years ago as part of its sweeping retooling of the credit card industry by capping the fees an issuer can charge at 25 percent of the card’s limit during its first year of use. For example, a card offered by First Premier bank with a $300 credit limit comes with a $75 annual fee — within the boundary set by Congress.