Today, Senators Bernie Sanders (I-VT) and Josh Hawley (R-MO) are introducing legislation to cap credit card interest rates at 10 percent. The legislation would be in effect for five years.
AFSA was quoted in the NYT opposing the bill: The American Financial Services Association, a trade organization for credit card issuers, has said rate caps are “’unworkable’ and ‘actually harm the consumers policymakers are trying to help, by limiting the types of credit tens of millions of Americans depend on more than ever.’”
As AFSA has stated before, legislation or regulation capping late fees misunderstand the role these fees play in the marketplace. When consumers pay late, their credit scores drop, and they face an increase in the cost of future credit and a reduced ability to access credit, and fees act as a deterrence measure. Late fees also help financial institutions manage the risk. If financial institutions are unable to price for risk, they will raise prices across the board, limit rewards programs, or limit credit availability. None of the outcomes above is good for consumers.
AFSA is continuing to educate members on the issue and does not anticipate broad Republican support for this legislation. However, President Trump has previously said that he would support a temporary cap on credit card fees. During his confirmation hearing, Treasury Secretary Bessent did not take an affirmative side on the late fee cap issue, but said he would support the whatever president’s policy decision was.
Today, Senators Bernie Sanders (I-VT) and Josh Hawley (R-MO) are introducing legislation to cap credit card interest rates at 10 percent. The legislation would be in effect for five years.
AFSA was quoted in the NYT opposing the bill: The… Read the rest
Today, President Trump announced that on January 31 he appointed Secretary of the Treasury Scott Bessent as acting director of the CFPB. As one of his first actions as acting director, Secretary Bessent ordered that the CFPB will:
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In the past two months the CFPB has worked overtime – literally – to reinforce its reputation as an agency of over-reach and unaccountability. Now, with no director and a new administration that has made it clear there will be a … Read the rest
AFSA congratulates Rep. French Hill(R-AR), on his election to the Chairmanship of the House Financial Services Committee. AFSA has worked with Representative Hill on a number of issues crucial to American consumers and the consumer credit… Read the rest
On January 29 the CFPB issued a report saying that U.S. military Servicemembers “pay higher costs and face greater financial risks” than their civilian neighbors when financing vehicles. This report insinuates that servicemembers are… Read the rest
On January 28, Elora Rayhan from AFSA’s State Government Affairs team testified at an Oregon committee hearing in opposition to OR HB 2561. This bill would opt-out the state from the Depository Institutions Deregulation and Monetary Control… Read the rest
AFSA is excited to support Representative Andy Barr’s reintroduction of his Taking Account of Bureaucrats’ Spending (TABS) Act. The TABS Act would bring the CFPB under congressional review and its budgetary process. Currently, the CFPB… Read the rest
Last week AFSA’s State Government Affairs team submitted testimony opposing Maryland HB 29 and Washington SB 5070, both of which seek to limit interchange fees on the gratuity and sales tax portions of electronic transactions. These … Read the rest
AFSA, along with many other trade associations, sent a letter this week to Senate Commerce Committee Chairman Ted Cruz (R-TX), Senate Commerce Committee Ranking Member Maria Cantwell (D-WA), House Energy and Commerce Chairman Brett Guthrie… Read the rest
