Consumers Confused About Credit Card Terms
In December 2011, the Consumer Financial Protection Bureau (CFPB) issued a report on its first three months of collecting credit card complaint data. CFPB’s Consumer Response Office began with an exclusive focus on credit card inquiries and complaints when it launched on July 21, 2011. It began taking complaints and inquiries related to home mortgages last December. And the bureau expects to handle complaints for all financial products and services by the year’s end.
The report makes three observations about the data that’s been collected so far:
CFPB also asked the public to comment on its proposed policy for disclosing certain credit card complaint data. It would make available to the public a searchable database containing various data fields for each complaint. CFPB studies how it can efficiently and effectively filter confidential personal information from the complaint data, and invites comment on the proposed policy through the end of the year.
CFPB Tests Prototype Agreement
CFPB launched another “Know Before You Owe” project to simplify credit card agreements. This is the third project in the campaign, which also included efforts to make mortgage and student loan information more transparent.
CFPB asks the public to weigh in on a prototype credit card agreement that is shorter, written in plain language, and explains key features upfront. At press time, CFPB also planned to pilot test the prototype with a credit union to get on-the-ground consumer feedback.
For more CFPB news, visit consumerfinance.gov.
Interchange Exclusivity & Routing Deadline Ahead
Don’t forget the Federal Reserve’s Regulation II network exclusivity and routing requirements go into effect for all debit card issuers on April 1, 2012, regardless of asset size.
Regulation II requires a card issuer or payment card network to ensure that debit cards can be processed on at least two unaffiliated networks—one signature and one PIN network—if the card has both signature and PIN capabilities.
Alternatively, an issuer could provide a debit card that can be processed on two or more unaffiliated signature networks, but not on any PIN networks, or that can be processed on two or more unaffiliated PIN networks, but not on any signature networks.
Regulation II also prohibits issuers and payment card networks from limiting a merchant’s ability to choose the network on which a transaction is routed, with respect to those networks on which the debit card can be used.
Next: Bureau Seeks Input on Streamlining Regs