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CFPB releases new credit card market report
Yesterday, the Consumer Financial Protection Bureau (CFPB) released its biennial report on the state of the credit card market for 2017-2018, which found credit cards constitute the largest consumer lending market.
Other key findings from the report include:
- Market conditions remain stable due to low unemployment, modest wage growth and high consumer confidence;
- Consumer satisfaction with credit cards remains high and debt service burdens are near the lowest level in more than a decade;
- Late payment and default rates have risen modestly, but they remain below pre-recession levels;
- Since 2015, consumers have more than doubled spending with credit cards with only modest balance growth; and
- The “great majority” of consumers obtain credit card rewards from their spending, and rewards are the primary factor used by consumers when choosing a credit card.
Responding to the CFPB's request for information regarding the consumer credit card market, NAFCU's Regulatory Affairs Counsel Kaley Schafer previously sent a letter to the agency advocating for more flexibility to allow credit unions to be able to properly serve their members. She noted that credit unions, on average, offer lower interest rates on credit cards than banks: 11.69 percent vs. 13.62 percent, respectively.
The biennial report is required by the Credit Card Accountability and Responsibility Disclosure (CARD) Act and was first the responsibility of the Federal Reserve System's Board of Governors, but transferred to the CFPB with the passage of the Dodd-Frank Act. It is published every two years.
NAFCU has previously shared with the CFPB that the 2009 CARD Act has added significantly to credit unions' compliance costs.