Oluwanifemi Ojo
The Executive Office of the President of the United States has announced its plans to reduce charges on credit card late fees and slash the prices charged on mobile app stores by Apple and Alphabet, Google parent company.
White House officials said the effort to slash these charges is part of a larger policy drive to encourage competition within consumer markets.
The president, Joe Biden was also set to ban subtle “Junk fees” and other fees that are found in retail services across different sectors of the economy that causes an unwarranted increase in the consumer costs. This also includes the charges placed on families to be provided a seat near young children. This was stated by the White House officials.
Biden has shown concerns over rise in inflation while also blaming House Republicans’ for supporting tax measures that would worsen inflation. The president added that the tax measures will only benefit those who are wealthy, not considering the middle-class citizens who pay tax as well.
A report by Reuter says Biden has been criticising the Republicans for their failure to approve a raise in the U.S debt ceiling until there is a negotiation on cutting future government spending.
The announcement on Wednesday falls on the same day as a meeting between Biden and House Speaker Kevin McCarthy that is anticipated to be the beginning of a drawn-out negotiation process to raise the $31.4 trillion borrowing cap.
The Consumer Financial Protection Bureau will propose a regulation on Wednesday to prohibit “excessive” late payment fees, which the bureau estimates cost consumers $12 billion annually.
The Director of CFPB Rohit Chopra said to some reporters during a call on Tuesday, “When someone misses a credit card payment, even if they paid just a day or two late, or even a few hours, they can be hit with a cascading series of fees,”
According to Chopra, the fees paid is exorbitant and exceeds any additional costs incurred by lenders. A regulatory threshold of $8 has been placed by the rule which is indicated by CFPB data analysis.
He added that the regulations could be effective from 2024 after the comment period. Meanwhile, the regulation is susceptible to a lawsuit by industry groups which can cause its delay or blockage.
