FWC Takes Action Against Consumer Financial Protection Bureau Credit Card Late Fee Rule

A core function of the Fort Worth Chamber is to promote public policy that fosters a strong business climate, and to oppose policies that hinder the ability of businesses to grow and prosper. The recent credit card late fees rule proposed by the CFPB compels us to act in support of small businesses and consumers in Fort Worth and beyond.

On March 5, the Consumer Financial Protection Bureau (CFPB) issued its final rule on credit card late fees. The rule caps all monthly credit card late fees at $8 per occurrence, a 75% reduction from the current maximum charge of $32. While the rule may be well intentioned in an attempt to reduce fees for credit card users, there are legitimate concerns about its impact in practice.

A 2023 survey conducted by North Star Research discovered the following:

  • 99% say it is important they pay their credit card on time
  • 82% of consumers make all of their payments on time; just 5% make more than one late payment per year
  • 96% are aware that not paying their credit card bill on time can decrease their credit score
  • 74% know their bank charges a late payment plus interest
  • 72% are aware of extra alerts from their card issuer to avoid making a late payment

These sentiments reveal that overwhelming majorities are aware of the consequences of not paying on time, and think it is important to pay their credit card bills on time. The CFPB’s final rule could result in a decreased incentive for consumers to pay their credit card bills before late fees are incurred. In lieu of being able to collect those fees, credit card issuers may need to pivot to increased annual fees, balance transfer fees, cash advance fees, and foreign transaction fees, or to decrease benefits such as cashback, discounts, and airline miles.

In effect, these increased costs and reduced benefits would negatively impact the overwhelming majority of consumers who pay their credit card bills on time every month, spreading the cost of those who are late to those who pay on time. According to the same North Star Research survey, respondents do not believe this is a worthwhile tradeoff by nearly a two-to-one margin.

Small businesses and consumers across Fort Worth utilize credit cards on a daily basis. The CFPB’s rule will increase their cost of doing business even if they pay their credit card bills on time every month. Particularly during a time of increased costs to access capital with high interest rates, this is not a rule that will benefit small businesses and consumers who pay their credit card bills on time.

The Fort Worth Chamber of Commerce is joining the U.S. Chamber of Commerce and others as co-plaintiffs in a lawsuit to prevent this rule from going into effect. The complaint was officially filed on March 7 in the United States District Court for the Northern District of Texas.

Stay tuned for updates on this litigation with the Fort Worth Chamber's weekly Policy Pulse updates, newsletters, and social media channels. For the most recent developments visit fortworthchamber.com/public-policy.

State and Local
Upcoming Dates
  • March 19: Tarrant County Commissioners Court, 10 a.m. at G.K Maenius Administration Building
  • March 19: Fort Worth City Council, 6 p.m. at City Hall
  • April 9: Leaders in Government: Public Safety, 8 a.m. at PalmWood [More info]
  • April 30 – May 2: D.C. Fly-in presented by Lockheed Martin[More info]
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