Trump administration to scrap Biden-era credit card late fee rule

Trump administration seeks to scrap $8 credit card late fee cap

Robert Besser
19 Apr 2025, 05:28 GMT+10

Trump administration to scrap Biden-era credit card late fee rule

Former President Donald Trump’s administration asked a federal court to cancel a rule that limits credit card late fees to US $8. They agreed with business and banking groups who said the rule was illegal
The U.S. Consumer Financial Protection Bureau (CFPB) and the business groups who sued over the rule asked a judge in Texas to officially end it
That judge, Mark Pittman, had already stopped the rule from taking effect. The rule was part of President Joe Biden’s efforts to reduce “junk fees"

WASHINGTON, D.C.: President Donald Trump's administration asked a federal court to cancel a rule that limits credit card late fees to US $8. They agreed with business and banking groups who said the rule was illegal.

The U.S. Consumer Financial Protection Bureau (CFPB) and the business groups who sued over the rule asked a judge in Texas to officially end it. That judge, Mark Pittman, had already stopped the rule from taking effect. The rule was part of former President Joe Biden's efforts to reduce "junk fees."

The CFPB and the U.S. Chamber of Commerce, which led the lawsuit, didn't respond to requests for comment.

Trump has tried to shut down the CFPB before, but courts have blocked some of his efforts. A recent appeals court decision said the government can reduce the number of CFPB employees, but not close the agency entirely.

The CFPB was created after the global financial crisis to protect consumers. But many Republicans say the agency has too much power and isn't held accountable.

The rule in question would have stopped big credit card companies (with over 1 million accounts) from charging more than $8 in late fees, unless they could prove higher fees were needed to cover their costs.

Judge Pittman, who Trump appointed, said in December that the rule broke a 2009 law meant to protect consumers. That law limits excessive fees but still allows card companies to charge penalties when customers miss payments.

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