DCUC Sends Letter to Senate Banking, Housing, and Urban Affairs Committee on Consumer Protection Examining Fees

WASHINGTON, D.C. – On May 8, 2024, the Defense Credit Union Council (DCUC) sent a letter to the Honorable Sherrod C. Brown, Chairman, and the Honorable Tim E. Scott, Ranking Member, of the Banking, Housing, and Urban Affairs Committee, U.S. Senate. In the letter, DCUC provided its response to the committee hearing on “Consumer Protection: Examining Fees in Financial Services and Rental Housing.” DCUC’s letter shared its support of credit union industry counterparts’ concerns regarding “government overreach in determining fees at individual credit unions.”

​DCUC also highlighted the adverse impact decreasing credit card late fee amounts would have on “74 percent of consumers who pay their late fees on time.”

“…issuers will be forced to increase costs to offset delinquencies and charge-offs…higher principal and interest payments will increase the burden on all military consumers. This is in addition to current challenges such as food insecurity, spouse employment, and rising childcare costs. It is especially troubling since more military families rely on credit cards to make ends meet.”

DCUC raised additional concerns with the CFPB's new rule and how it would place military families at risk of predatory lenders by eliminating financial programs such as overdraft protection; not to mention, also creating challenges for military leadership to maintain good order and financial discipline as required.

“When credit card late fees are significantly reduced, there is less incentive to pay on time. Although military members are instructed to honor their credit card commitments, DoD lacks the mechanisms to prevent, intervene, or enforce standards until it is too late. Thus, it is hard to see how imposing government controls on late fees will improve financial discipline and responsibility. We fear CFPB’s rule will make both worse.”

Please see DCUC’s attached letter for its full official response. DCUC continues to advocate for, and champion, the interest of all credit unions serving on or near United States military installations around the world.

“The Defense Credit Union Council values any opportunity to highlight potential impacts on military members. As always, we believe we can be effective partners with regulators in ensuring a safe and secure financial environment for our Nation’s military and veteran communities,” said DCUC in its letter.

To learn more about DCUC’s advocacy, visit www.DCUC.org/advocacy.