The Consumer Financial Protection Bureau (CFPB) has issued a policy circular warning credit card companies against devaluing rewards points, citing potential legal repercussions and consumer complaints. The regulator argues that provisions against unfair, deceptive, and abusive practices mean authorities can punish card issuers for reducing the value of such rewards based on fine print or technical errors.
The CFPB notes that rewards programs are increasingly used to encourage customers to sign up for cards, with 75% of general purpose cards being rewards cards by the end of 2022. The bureau’s effort comes as its future as an agency is uncertain, with President-elect Donald Trump potentially making sweeping changes to regulation and enforcement policies.
Meanwhile, a recent report from PYMNTS Intelligence/Atelio found that 81% of “credit curious” consumers express interest in secured credit cards, which could offer a solution for those looking to build credit. The CFPB’s warning highlights the importance of protecting consumer rights in the credit card industry.
Source: https://www.pymnts.com/news/cfpb/2024/cfpb-reports-dramatic-increase-in-complaints-about-card-rewards