"Biden Administration's $8 Cap on Credit Card Late Fees Sparks Industry Backlash"
The Biden administration is proposing a $8 cap on credit card late fees, aiming to save consumers $10 billion, but the banking industry warns it could lead to higher interest rates and unintended consequences. The American Bankers Association and the Consumer Bankers Association argue that the rule could result in more late payments, lower credit scores, and reduced access to credit. The U.S. Chamber of Commerce is suing over the proposed rule, claiming it punishes those who pay on time. The rule, which only applies to large credit card companies, allows banks to charge a higher late fee under a "show your work" provision.
