The CFPB recently requested comment from the public on what it deems to be “exploitative junk fees” and their impact. It then followed up with a blog on “The hidden cost of junk fees” which further encourages people to share their experiences. The CFPB describes these fees (such as those for document preparation, late payments, overdrafts, minimum balance requirements, stop payments, paper statements, card replacement, and out-of-network ATMs, etc.), as being “nominally voluntary” since they are not “meaningfully avoidable or negotiable in the moment”.
The CFPB is concerned that such fees drive up the cost of having a deposit account/getting a loan and diminish competition. It compares them to “resort fees” or “mystery fees” that people may see on their cable or phone bills.
The CFPB wants stories, data, and other information on experiences with “junk fees” and is specifically looking to hear from individuals as well as small business owners, and others, including government officials. Nine questions were provided in the request for comment and the CFPB specifically requests experiences of fees that were unexpected, believed to be too high and/or charged for unknown reasons.
At this point, it’s hard to say exactly where this will go but it’s important to note that this request includes both deposit and loan junk fees. While there is likely more to come, it’s always a good idea to look at your fees from time to time and reevaluate what you’re charging and why. The request for comment and blog seem to indicate this will be an area of increasing focus. Stay tuned!
In case you missed it, we discussed this in mWe discussed this in more detail during our February Monthly Connection. Here is short clip:
Amy brings many years of banking and compliance experience to Banker’s Compliance Consulting. She has worked for both large and small financial institutions and spent time working in every area of a bank. She started out as a teller in college and eventually became a branch manager.
Her love, however, was always compliance. Amy began her career with Banker’s Compliance Consulting in 2000. Her knowledge and experiences have allowed her to develop a well-rounded and practical approach to regulatory compliance. Amy is CRCM certified, has a Bachelor’s Degree in Business Administration, and is a graduate of the ABA Compliance School.
Amy & her husband have two children at home and stay busy following their activities. They spend a lot of time in the bleachers!