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CFPB and Industry Groups Move to End Biden-Era Credit Card Late Fee Rule

Joint motion filed in Texas federal court seeks to permanently vacate the $8 late fee cap, concluding prolonged litigation.

Demonstrators take part in a protest by the Consumer Financial Protection Bureau (CFPB) building, the day after members of Elon Musk's Department of Government Efficiency (DOGE) moved into the CFPB, in Washington, U.S. February 8, 2025. REUTERS/Nathan Howard/File Photo
A special police member monitors a protest, while inside the Consumer Financial Protection Bureau (CFPB) building, the day after members of Elon Musk's Department of Government Efficiency (DOGE) moved into the CFPB, in Washington, U.S. February 8, 2025. REUTERS/Nathan Howard
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Overview

  • The Consumer Financial Protection Bureau (CFPB), alongside bank trade groups, has filed a joint motion to vacate the Biden-era rule capping credit card late fees at $8.
  • The motion, filed in the Northern District of Texas, marks the formal conclusion of a year-long legal battle over the regulation.
  • U.S. District Judge Mark T. Pittman had previously ruled in December 2024 that the rule violated the CARD Act by failing to allow 'reasonable and proportional' penalty fees.
  • The CFPB and trade groups agreed to dismiss the case with prejudice, ensuring the rule cannot be refiled or reopened in the same court.
  • The rule's termination is estimated to save the credit card industry nearly $10 billion annually, reigniting debates over consumer protections versus business interests.