CFPB

Credit Card Companies Still Confusing Customers, CFPB Contends

The Consumer Financial Protection Bureau, which was established in July 2011 on the heels of the financial crisis, has long tried to get credit card companies to disclose more about the rates and fees they charge, and it turns out it isn’t doing such a good job at it.

According to the CFPB’s monthly complaint snapshot about credit cards, the government agency found consumers still have a tough time getting clear information from their credit card companies regarding their creditworthiness and information about the fees and payments they are on tap for.

“Credit cards are an important tool in the day-to-day financial lives of a large number of consumers,” said CFPB Director Richard Cordray. “It is important that credit card companies are being straightforward and clear about the costs and fees associated with their products so consumers have the information they need to make informed financial decisions.”

According to the monthly report, one of the top complaints for the month centered on trouble understanding why a credit card company made the decision it did regarding an initial application for a credit card. The consumers contend credit decisions are being made based on existing items on their credit report, which aren’t reflective of their creditworthiness. Another issue consumers had with credit card companies: confusion over how payments are applied to accounts that have multiple balances. The consumers who complained said they didn’t receive clear information about how the payments made were applied to the multiple accounts.

The CFPB also found consumers were charged with various fees and additional costs when using their credit cards, which they said were charged when things like automatic payment failed or a billing statement wasn’t delivered in a timely manner. Finally, the government agency said consumers felt misled about credit card reward programs, with many complaining they had a hard time receiving the benefits that were promised as part of a special rewards programs.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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