On May 9, the CFPB
issued a
report on credit card rewards programs which highlighted the CFPB’s views on issues affecting millions of consumers. The report opened with a note that the CFPB received over 1,200 complaints regarding credit card rewards in 2023, reportedly a 70 percent increase since before the pandemic, and according to the CFPB, the research found that the benefits of rewards programs “fail to exceed” the costs of credit cards for many borrowers. The report identified four themes: consumers felt misled by vague or hidden conditions that do not match marketing materials from issuers; consumers lost out when card issuers devalue rewards; consumers faced obstacles when card issuers do not resolve redemption issues; and consumers lost rewards when accounts are closed.
In a live panel between the Director of the CFPB, Rohit Chopra, Secretary of the DOT, Pete Buttigieg, and airline trade leaders on credit card reward programs, Chopra noted that there were 550 million credit cards in the U.S. which collectively account for over $1 trillion in consumer debt. Chopra also stated the CFPB will review how it can protect consumers against the devaluation of credit card points. In the panel, Chopra asked the trade groups what they would like the CFPB to do regarding credit card terms and conditions: some organizations asked for greater transparency in points systems, with one suggesting that credit card issuers’ ability to change terms mid-contract should be prohibited.
