Sponsors (6)
The bill delivers immediate, tangible late-fee relief and greater CFPB transparency for many credit card users — especially low- and middle-income customers of large issuers — but risks shifting costs back to consumers through higher rates or reduced benefits, leaves customers of small issuers less protected, and creates legal and compliance uncertainties.
Low- and middle-income credit card users of large issuers will face much lower out-of-pocket late fees — capped (e.g., $8) and limited to amounts reasonable and proportional to issuers' actual costs.
The bill increases regulatory transparency and stakeholder input by requiring the CFPB to publish underlying research before proposing rules and to follow APA notice-and-comment procedures, while Congressional clarification reduces some legal uncertainty about the Bureau's authority.
Codifying and supporting the fee-limit framework encourages fairer billing practices and better protections against punitive or profit-driven late-fee practices.
Banks and large card issuers may lose late-fee revenue, which could lead them to raise interest rates, reduce rewards/benefits, or tighten underwriting — making credit more expensive or less available for some consumers.
The $8 cap and related protections apply only to 'large' issuers (≥1,000,000 accounts), leaving customers of smaller banks and credit unions without the same relief.
Compliance and implementation costs (and shifts in regulatory burden) may disproportionately strain smaller lenders and community banks, potentially reducing their ability to serve local customers.
Based on analysis of 3 sections of legislative text.
Codifies a CFPB rule to limit credit‑card late fees for large issuers, capping late fees at $8 (CPI‑adjustable) and prohibiting fees above an issuer's actual costs as set by the CFPB.
Codifies the Consumer Financial Protection Bureau's regulation that limits credit-card late fees and narrows the statutory standard for calculating costs from omissions or violations to the actual cost incurred by the creditor. For very large card issuers (those with 1,000,000 or more open accounts), the bill caps late fees at $8 and also bars charging more than the issuer's actual cost as determined by the CFPB; the CFPB may raise the $8 cap by up to the change in CPI‑U between enactment and implementation. The bill requires the CFPB to issue a rule under the Administrative Procedure Act, to publish the research behind the proposed rule before public comment, and directs that legal challenges under the new late-fee subsection be filed in U.S. District Court for the District of Columbia.
Introduced January 15, 2026 by John Karl Fetterman · Last progress January 15, 2026