In 2022, Americans paid more than $120 billion in interest and fees on credit cards. With interest rates going up, that amount is continuing to increase.
For consumers to get the best offers on credit cards to keep their costs down, their repayment records need to be reported to credit bureaus.
In 2020, the Consumer Financial Protection Bureau or CFPB found that the largest credit card companies started to deliberately suppress their customers’ actual payment amounts from the nationwide consumer reporting system.
Last May, the CFPB sent letters to the CEOs of the nation’s biggest credit card companies – JPMorgan Chase, Citibank, Bank of America, Capital One, Discover, and American Express – asking them if they ever furnished actual payment information. For those that suppress actual payment information, the agency asked why they stopped sending complete data, and if they had any plans to change their practice. Here’s what the CFPB learned:
- Major market players made the change to suppress data within a short period of time. After the change made by these companies, the share of furnished credit card accounts with actual payment information fell by more than half from 88 percent in late 2013 to 40 percent by 2015.
- Credit card companies didn’t say when they would restart reporting actual payment information. In some cases, companies stated they didn’t intend to restart reporting.
- Companies suppressed data to limit competition. The responses suggested companies withheld information in an attempt to make it harder for competitors to offer their more profitable and less risky customers better rates, products, or services.
Credit card companies’ failure to report actual payment data means that millions of people’s credit reports are missing fundamental information about their credit card repayment behavior that could help many of them receive better financial offers and potentially save billions of dollars in interest expenses, the CFPB said in a statement.
The table above shows the responses of the biggest credit card companies to the agency’s letter without naming which company sent in the response.
This is just another indication of how big corporations are continually gouging consumers and why more needs to be done to stop them.
