Sen. John Fetterman introduces bill that would cap credit card late fees at $8

Pennsylvania Senator John Fetterman wants to cap credit card late fees.

Fetterman, along with two other democratic senators, introduced the Credit Card Fairness Act, last week. If passed, it would put into statute the Consumer Financial Protection Bureau’s $8 cap on credit card late fees.

The CFPB rule that enacted this cap was stalled in litigation brought on by banks.

The lawmakers state that consumers currently pay $14 billion per year in credit card late fees. The standard late fee is $30-$41, which is up to five times higher than the cost for banks of collecting late payments.

“Big banks profiteering off people by charging $41 for a single late credit card payment is absolutely wrong,” Senator Fetterman said. “At a time when people are struggling to get by, these late fees are only doing more harm. This legislation will protect hardworking Americans from predatory fees, and I’ll work with anyone to get this over the finish line.”

The legislation is endorsed by Americans for Financial Reform, the Consumer Federation of America, Groundwork Collaborative, the National Consumer Law Center (on behalf of its low-income clients), Public Citizen, and Protect Borrowers.

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