CFPB: Consumers Saved $16 Billion in Fees from CARD Act

CFPB: Consumers Saved $16 Billion in Fees from CARD Act

December 8, 2015         Written By John H. Oldshue

The Consumer Financial Protection Bureau released a report assessing how the Credit Card Accountability Responsibility and Disclosure Act (CARD Act) has affected credit card fees in America. According to the CFPB’s estimates, consumers have saved up to $16 billion in “gotcha” fees since the reform law was put into place.

The CARD Act was designed to protect consumers from high late fees, unexpected changes in interest rates, and over-limit fees that were deemed “unfair” in 2009. Since that time, the CFPB says consumers have saved over $9 billion in over-limit fees and an additional $7 billion in late fees.

For example, before the CARD Act, card issuers could authorize transactions that would put a cardholder over their credit limit, which would cost them an average $35 over-limit fee. The CARD Act required that companies get consumers to “opt-in” before making charges that exceed their credit limit. The CARD Act also required all penalty fees, including late fees, to be “reasonable and proportional” to the relevant violation. Since 2009, the average late fee has declined by 20%.

Credit card accounts are growing faster than the adult population in America. There were more than 100 million credit card accounts opened in 2014, producing an annual growth rate of 3%. By comparison, the adult population in the United States increases an average of 1% per year.

While the increase in credit card accounts is relatively alarming, the good news is that some of these new accounts come with free credit scores to help cardholders keep track of their credit. Over 100 million credit card accounts now come with free credit score reporting, which can help consumers stay on track with their payments and expenses.

“The CARD Act has helped people avoid more than $16 billion in gotcha credit card fees,” said CFPB Director Richard Cordray. “The law made it easier for consumers to evaluate costs and risks by eliminating the worst back-end pricing practices in the market. There is more work to do. But with commonsense rules in place, credit cards are safer and more affordable, credit is more available, and companies remain profitable with improved customer satisfaction.”

The information contained within this article was accurate as of December 8, 2015. For up-to-date
information on any of the terms, cards or offers mentioned above, visit the issuer's website.


About John H. Oldshue

John Oldshue is the creator of He worked for over 15 years in television and won an Emmy award for his reporting. He covers credit card rate issues for
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