Dear Director Chopra:
The Bank Policy Institute, American Bankers Association, Consumer Bankers Association, Credit
Union National Association, and the National Association of Federally-Insured Credit Unions[1] are writing with respect to the Consumer Financial Protection Bureau’s notice of proposed rulemaking regarding Credit Card Penalty Fees (Regulation Z). The NPR has not yet been published in the Federal Register, but was published on the CFPB’s website on February 1, 2023, available at: Credit Card Penalty Fees (Regulation Z).[2] The NPR proposes sweeping changes to the provisions of Regulation Z related to credit card late fees. Among other changes, the proposal would reduce the credit card late fee safe harbor to $8 from its current levels of $30 for a first violation and $41 for a subsequent violation within the next six billing cycles. In support of that dramatic reduction and other proposed changes, the Bureau relies extensively on data from the Federal Reserve Board’s Y-14M data collection and other “[i]nformation provided in response to a series of data filing orders made to several industry participants, comprised of two distinct sets” and refers repeatedly to analyses it conducted using such
data.[3]
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[1]See Appendix for association descriptions.
[2] The NPR has not yet been published in the Federal Register, but was published on the CFPB’s website on February 1, 2023, available at: Credit Card Penalty Fees (Regulation Z) (consumerfinance.gov).
[3]The NPR refers to the 2021 Annual Credit Card Report, which states that the two sets are: “a) Data requested from a broad and diverse group of issuers to address a range of topics that neither CCP nor Y-14 data can address. This report refers to these data as Mass Market Issuer (MMI) data. These data cover application and approval volumes, rates, and channels, deferred interest, digital account servicing, certain aspects of the impact of COVID19 on consumers and issuers, and loss mitigation policies and practices, including debt collection. b) Data requested from a diverse group of specialized issuers. These summary data, which focus on basic indicators of usage and cost, in places supplement the Y-14 to allow for a broader or more detailed perspective into certain facets of the market than either the Y-14 or [the Bureau’s Consumer Credit Panel] allow. Where these data supplement Y-14 data, those data are collectively called “Y-14+””. See, NPR at 19, note 58, citing to the Bureau’s 2021 Card Report, at 17.
