[Federal Register Volume 88, Number 18 (Friday, January 27, 2023)]
[Notices]
[Pages 5313-5315]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-01722]


=======================================================================
-----------------------------------------------------------------------

BUREAU OF CONSUMER FINANCIAL PROTECTION

[Docket No. CFPB-2023-0009]


Request for Information Regarding Consumer Credit Card Market

AGENCY: Bureau of Consumer Financial Protection.

ACTION: Notice and request for information.

-----------------------------------------------------------------------

SUMMARY: Section 502(a) of the Credit Card Accountability 
Responsibility and Disclosure Act of 2009 (CARD Act or Act) requires 
the Consumer Financial Protection Bureau (CFPB) to conduct a review 
(Review) of the consumer credit card market, within the limits of its 
existing resources available for reporting purposes. In connection with 
conducting that Review, and in accordance with section 502(b) of the 
Act, the CFPB is soliciting information from the public about a number 
of aspects of the consumer credit card market as described further 
below.

DATES: Comments must be submitted on or before April 24, 2023, to be 
assured of consideration.

ADDRESSES: You may submit responsive information and other comments, 
identified by the document title and Docket No. CFPB-2023-0009, by any 
of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     Email: [email protected]. 
Include the document title and Docket No. CFPB-2023-0009 in the subject 
line of the message.
     Mail/Hand Delivery/Courier: Comment Intake, Request for 
Information Regarding Consumer Credit Card Market, Consumer Financial 
Protection Bureau, c/o Legal Division Docket Manager, 1700 G Street NW, 
Washington, DC 20552. Because paper mail in the Washington, DC area and 
at the CFPB is subject to delay, commenters are encouraged to submit 
comments electronically.
    Instructions: The CFPB encourages the early submission of comments. 
All submissions should include the agency name and docket number for 
this request for information. Please note the number of the topic on 
which you are commenting at the top of each response (you do not need 
to address all topics). In general, all comments received will be 
posted without change to https://www.regulations.gov. All comments, 
including attachments and other supporting materials, will become part 
of the public record and subject to public disclosure. Sensitive 
personal information, such as account numbers or Social Security 
numbers, should not be included. Comments generally will not be edited 
to remove any identifying or contact information.

FOR FURTHER INFORMATION CONTACT: Wei Zhang, Consumer Credit, Payments, 
and Deposits Markets Section Chief, Division of Research, Markets, and 
Regulations, at (202) 435-7700, or [email protected]. If you require 
this document in an alternative electronic format, please contact 
[email protected].

SUPPLEMENTARY INFORMATION: Section 502(a) of the CARD Act \1\ requires 
the CFPB to conduct a review, within the limits of its existing 
resources available for reporting purposes, of the consumer credit card 
market every two years. To inform that review, section 502(b) instructs 
the CFPB to seek public comment.\2\
---------------------------------------------------------------------------

    \1\ See 15 U.S.C. 1616(a).
    \2\ See 15 U.S.C. 1616(b).
---------------------------------------------------------------------------

    The CFPB's first such review was published in October 2013; the 
CFPB's second such review was published in December 2015; the CFPB's 
third such review was published in December 2017; the CFPB's fourth 
such review was published in August 2019; the CFPB's fifth such review 
was published in September 2021.\3\ To inform the CFPB's next review, 
the CFPB hereby invites members of the public, including consumers, 
credit card issuers, industry analysts, consumer groups, and other 
interested persons to submit information and other comments relevant to 
the issues expressly identified in section 2 below, as well as

[[Page 5314]]

any information they believe is relevant to a review of the credit card 
market.
---------------------------------------------------------------------------

    \3\ CARD Act Report, available at http://files.consumerfinance.gov/f/201309_cfpb_card-act-report.pdf; The 
Consumer Credit Card Market, available at http://files.consumerfinance.gov/f/201512_cfpb_report-the-consumer-credit-card-market.pdf; The Consumer Credit Card Market, available at 
https://files.consumerfinance.gov/f/documents/cfpb_consumer-credit-card-market-report_2017.pdf; The Consumer Credit Card Market, 
available at https://files.consumerfinance.gov/f/documents/cfpb_consumer-credit-card-market-report_2019.pdf; The Consumer 
Credit Card Market, available at https://files.consumerfinance.gov/f/documents/cfpb_consumer-credit-card-market-report_2021.pdf.
---------------------------------------------------------------------------

1. Background: The CARD Act

    The CARD Act was signed into law in May 2009.\4\ Passage of the Act 
was expressly intended to ``establish fair and transparent practices 
related to the extension of credit'' in the credit card market.\5\ To 
achieve these agreed-upon purposes, the Act changed the requirements 
applicable to credit card practices in a number of significant 
respects.\6\
---------------------------------------------------------------------------

    \4\ The CARD Act's provisions took effect in three stages: 
August 2009, February 2010, and October 2011.
    \5\ Public Law 111-24, 123 Stat. 1734 (2009).
    \6\ See CARD Act Report at 10-13, available at http://files.consumerfinance.gov/f/201309_cfpb_card-act-report.pdf.
---------------------------------------------------------------------------

2. Issues on Which the CFPB Seeks Public Comment for Its Review

    In connection with its pending Review, the CFPB seeks information 
from members of the public about how the credit card market is 
functioning. The CFPB seeks comments on the experiences of consumers 
and credit card issuers in the credit card market and on the overall 
health of the credit card market, as outlined in section 502(a) and in 
(1) through (7) below. While the CFPB identifies specific topics of 
interest below, the CFPB also wants to be alerted to and understand the 
information that consumers, credit card issuers, industry analysts, 
consumer groups, and other interested persons believe is most relevant 
to the CFPB's review of the credit card market, so this list of 
subjects should not be viewed as exhaustive. Commenters are encouraged 
to address any other aspects of the consumer credit card market that 
they believe would be of interest or concern to the CFPB.
    Please feel free to comment generally or respond to any or all of 
the questions below but please indicate in your comments on which topic 
areas or questions you are commenting:

(1) The Terms of Credit Card Agreements and the Practices of Credit 
Card Issuers

    a. How have the substantive terms and conditions of credit card 
agreements or the length and complexity of such agreements changed over 
the past two years?
    b. How have issuers changed their pricing, marketing, underwriting, 
or other practices?
    c. How are the terms of, and practices related to, major 
supplementary credit card features (such as credit card rewards, 
deferred interest promotions, balance transfers, and cash advances) 
evolving? What are the terms of, practices related to, and prevalence 
of emerging supplementary credit card features (such as credit card 
installment plans)?
    d. How have issuers' marketing practices changed since the CFPB 
reported on the credit card market in 2021? Has this impacted 
consumers' ability to comparison shop? If so, in what ways?
    e. What practices of credit card issuers may uniquely affect 
special populations (such as servicemembers and their dependents, low- 
and moderate-income consumers, older Americans, and students)? What are 
the effects of protections specific to special populations (for 
example, the Servicemembers Civil Relief Act or the Military Lending 
Act)? How are these changing and what, if any, trends are evolving?
    f. How have practices related to collecting on delinquent and 
charged-off credit card debt changed over the past two years?
    g. Has the use of electronic communication (e.g., email or SMS) by 
creditors and debt collectors in connection with credit card debt grown 
or otherwise evolved? If so, in what ways?
    h. How are the terms of, and practices related to, partnerships 
between credit card issuers and merchant partners (such as hospitality, 
airline, healthcare, and/or retail companies) evolving?

(2) The Effectiveness of Disclosure of Terms, Fees, and Other Expenses 
of Credit Card Plans

    a. How effective are current disclosures of rates, fees, and other 
cost terms of credit card accounts in conveying to consumers the costs 
of credit card plans?
    b. What further improvements in disclosure, if any, would benefit 
consumers and what costs would card issuers or others incur in 
providing such disclosures?
    c. How well are current credit card disclosure rules and practices 
adapted to the digital environment? What adaptations to credit card 
disclosure regimes in the digital environment would better serve 
consumers or reduce industry compliance burden?

(3) The Adequacy of Protections Against Unfair, Deceptive, or Abusive 
Acts or Practices Relating to Credit Card Plans

    a. What unfair, deceptive, or abusive acts and practices exist in 
the credit card market? How prevalent are these acts and practices and 
what effect do they have? With regard to any unfair, deceptive, or 
abusive acts and practices that exist in the credit card market, how 
might any such conduct be prevented and at what cost?

(4) The Cost and Availability of Consumer Credit Cards

    a. How have the cost and availability of consumer credit cards 
(including with respect to non-prime borrowers) changed since the CFPB 
reported on the credit card market in 2021? What is responsible for 
changes (or absence of changes) in cost and availability? Has the 
impact of the CARD Act on cost and availability changed over the past 
two years?
    b. How, if at all, are the characteristics of consumers with lower 
credit scores changing? How are groups of consumers in different score 
tiers faring in the market? How do other factors relating to consumer 
demographics or financial lives affect consumers' ability to 
successfully obtain and use credit cards?

(5) The Safety and Soundness of Credit Card Issuers

    a. What, if any, safety and soundness risks related to the credit 
cycle are present or growing in this market, and which entities are 
disproportionately affected by these risks? Has the impact of the CARD 
Act on safety and soundness changed over the past two years?
    b. How have current dynamics related to funding sources (such as 
asset-backed securities or deposits) for credit card receivables 
affected issuers' profitability and lending operations? What changes, 
if any, in capital markets for credit cards have there been since the 
last biennial report? How do capital requirements for different types 
of institutions affect competition in the credit card market or 
consumer's access to and cost of credit? How might these trends 
positively or negatively impact consumers?

(6) The Use of Risk-Based Pricing for Consumer Credit Cards

    a. How has the use of risk-based pricing for consumer credit cards 
changed since the CFPB reported on the credit card market in 2021? What 
has driven those changes or lack of changes? Has the impact of the CARD 
Act on risk-based pricing changed over the past two years?
    b. How have CARD Act provisions relating to risk-based pricing 
impacted (positively or negatively) the evolution of practices in this 
market?

[[Page 5315]]

(7) Consumer Credit Card Product Innovation and Competition

    a. How has credit card product innovation changed since the CFPB 
reported on the credit card market in 2021? What has driven those 
changes or lack of changes? Has the impact of the CARD Act on product 
innovation changed over the past two years?
    b. How is competition in the consumer credit card market changing? 
How has the CARD Act (positively or negatively) impacted competition 
between credit card issuers? How, if at all, do these changes and 
impacts relate to the cost or availability of consumer credit cards?
    c. What barriers to entry, if any, exist in the consumer credit 
market? What obstacles may smaller financial institutions face when 
launching a credit card product? How are these impediments changing and 
what, if any, trends are evolving? To what extent are financial 
institutions adopting ``credit card-as-a-service'' offerings? How might 
these changes affect competition, promote innovation, or introduce 
risk, if at all?
    d. How have broader innovations in finance, such as (but not 
limited to) new products and entrants offering unique features (like 
rewards redemption for cryptocurrency, environmental causes, and other 
categories beyond cash-back or points), evolving digital tools, greater 
availability of and new applications for consumer data, and new 
technological tools (like machine learning), impacted the consumer 
credit card market, either directly or indirectly? In what ways do CARD 
Act provisions encourage or discourage innovation? In what ways do 
innovations increase or decrease the impact of certain CARD Act 
provisions, or change the nature of those impacts?
    e. How do innovations by firms offering other consumer financial 
products and services (such as buy-now-pay-later credit, mobile 
payments, or non-card point-of-sale loans) compete with credit cards, 
and to what extent do consumers view them as effective alternatives to 
or substitutes for credit cards?

Rohit Chopra,
Director, Consumer Financial Protection Bureau.
[FR Doc. 2023-01722 Filed 1-26-23; 8:45 am]
BILLING CODE 4810-AM-P