Consumers Union, which runs the influential Consumer Reports publication and website, recently came out in favor of the federal government further lowering penalty fees consumers can be charged, according to a report from the Madison Capital Times. It believes these charges, capped at $25 for a first offense and $35 for repeated missteps, can add to consumers' credit card debt too quickly and easily.
Further, the group alleges that penalty interest rates on credit card debt have not been effectively reined in, the report said. Currently, there is no cap at all, and it believes a penalty rate should not be able to exceed 7 percentage points more than the standard APR.
Once the Consumer Financial Protection Bureau gains its full power in July, many expect it to put a number of new protections related to credit card debt in place.