Consumer Credit Card Market Report of the Bureau of Consumer Financial Protection, 2019, 48331-48333 [2019-19811]
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Federal Register / Vol. 84, No. 178 / Friday, September 13, 2019 / Notices
Matters To Be Considered
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Dated: September 3, 2019.
David Holst,
Chief Financial Officer/Administrative
Officer, Office of Oceanic and Atmospheric
Research, National Oceanic and Atmospheric
Administration.
[FR Doc. 2019–19816 Filed 9–12–19; 8:45 am]
BILLING CODE 3510–KA–P
COMMITTEE FOR PURCHASE FROM
PEOPLE WHO ARE BLIND OR
SEVERELY DISABLED
Notice of Correction
Committee for Purchase From
People Who Are Blind or Severely
Disabled.
ACTION: Notice of correction.
AGENCY:
The Committee for Purchase
From People Who Are Blind or Severely
Disabled published a document in the
Federal Register of September 6, 2019
concerning a notice of Proposed
Addition.
khammond on DSKBBV9HB2PROD with NOTICES
SUMMARY:
Comments must be received on
or before: October 5, 2019.
ADDRESSES: Committee for Purchase
From People Who Are Blind or Severely
DATES:
VerDate Sep<11>2014
17:09 Sep 12, 2019
Jkt 247001
Disabled, 1401 S Clark Street, Suite 715,
Arlington, Virginia 22202–4149.
FOR FURTHER INFORMATION CONTACT: For
further information or to submit
comments contact: Michael R.
Jurkowski, Telephone: (703) 603–2117,
Fax: (703) 603–0655, or email
CMTEFedReg@AbilityOne.gov.
SUPPLEMENTARY INFORMATION:
Correction
In the Federal Register of September
6, 2019, in FR Doc. 84 FR 46940–46941,
the Committee published its intent to
add Coat, Dress, Army Services Green
Uniform, Men’s, Classic Fit, Heritage
Green to its Procurement List. Included
in this listing were women’s coat sizes,
which should have been separately
listed. The corrected listing is as
follows:
NSN: 8415–00–SAM–4548 through 8415–00–
SAM–4644
Coat, Dress, Army Services Green Uniform,
Men’s, Classic Fit, Heritage Green—
Sizes: 33–XS, 34–XS, 35–XS, 36–XS, 37–
XS, 38–XS, 39–XS, 40–XS, 41–XS, 42–
XS, 33–S, 34–S, 35–S, 36–S, 37–3XS, 38–
S, 39–S, 40–S, 41–S, 42–S, 43–S, 44–S,
45–S, 46–S, 47–S, 48–S, 49–S, 50–S, 51–
S, 52–S, 54–S, 30–R, 31–R, 32–R, 33–R,
34–R, 35–R, 36–R, 37–R, 38–R, 39–R, 40–
R, 41–R, 42–R, 43–R, 44–R, 45–R, 46–R,
47–R, 48–R, 49–R, 50–R, 51–R, 52–R, 54–
R, 32–L, 33–L, 34–L, 35–L, 36–L, 37–L,
38–L, 39–L, 40–L, 41–L, 42–L, 43–L, 44–
L, 45–L, 46–L, 47–L, 48–L, 49–L, 50–L,
51–L, 52–L, 54–L, 34–XL, 35–XL, 36–XL,
37–XL, 38–XL, 39–XL, 40–XL, 41–XL,
42–XL, 43–XL, 44–XL, 45–XL, 46–XL,
47–XL, 48–XL, 49–XL, 50–XL, 51–XL,
52–XL, 54–XL
NSN: 8415–00–SAM–4645 through 8415–00–
SAM–4730
Coat, Dress, Army Services Green Uniform,
Women’s, Heritage Green—Sizes: 4–JR–
P, 6–JR–P, 8–JR–P, 10–JR–P, 12–JR–P,
14–JR–P, 16–JR–P, 8–JR–R, 10–JR–R, 12–
JR–R, 14–JR–R, 16–JR–R, 18–JR–R, 20–
JR–R, 22–JR–R, 10–JR–T, 12–JR–T, 14–
JR–T, 16–JR–T, 12–JR–XT, 14–JR–XT,
16–JR–XT, 4–M–P, 6–M–P, 8–M–P, 10–
M–P, 12–M–P, 14–M–P, 16–M–P, 4–M–
R, 6–M–R, 8–M–R, 10–M–R, 12–M–R,
14–M–R, 16–M–R, 18–M–R, 20–M–R,
22–M–R, 24–M–R, 26–M–R, 6–M–T, 8–
M–T, 10–M–T, 12–M–T, 14–M–T, 16–
M–T, 18–M–T, 20–M–T, 22–M–T, 24–
M–T, 26–M–T, 16–M–XT, 18–M–XT, 20–
M–XT, 4–W–P, 6–W–P, 8–W–P, 10–W–
P, 12–W–P, 14–W–P, 16–W–P, 6–W–R,
8–W–R, 10–W–R, 12–W–R, 14–W–R, 16–
W–R, 18–W–R, 20–W–R, 22–W–R, 6–W–
T, 8–W–T, 10–W–T, 12–W–T, 14–W–T,
16–W–T, 18–W–T, 20–W–T, 22–W–T,
24–W–T, 26–W–T, 12–W–XT, 14–W–XT,
16–W–XT, 18–W–XT
Patricia Briscoe,
Deputy Director, Business Operations (Pricing
and Information Management).
[FR Doc. 2019–19831 Filed 9–12–19; 8:45 am]
BILLING CODE 6353–01–P
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48331
COMMITTEE FOR PURCHASE FROM
PEOPLE WHO ARE BLIND OR
SEVERELY DISABLED
Procurement List; Proposed Deletion
Committee for Purchase From
People Who Are Blind or Severely
Disabled.
ACTION: Proposed Deletion from the
Procurement List.
AGENCY:
The Committee is proposing
to delete product previously furnished
by such agencies.
DATES: Comments must be received on
or before: October 13, 2019.
ADDRESSES: Committee for Purchase
From People Who Are Blind or Severely
Disabled, 1401 S Clark Street, Suite 715,
Arlington, Virginia 22202–4149.
FOR FURTHER INFORMATION CONTACT: For
further information or to submit
comments contact: Michael R.
Jurkowski, Telephone: (703) 603–2117,
Fax: (703) 603–0655, or email
CMTEFedReg@AbilityOne.gov.
SUPPLEMENTARY INFORMATION: This
notice is published pursuant to 41
U.S.C. 8503 (a)(2) and 41 CFR 51–2.3. Its
purpose is to provide interested persons
an opportunity to submit comments on
the proposed actions.
SUMMARY:
Deletions
The following product is proposed for
deletion from the Procurement List:
Product(s)
NSN(s)—Product Name(s):
3915–04–000–4368—Small Web Door
Assembly
Contracting Activity: USPS, Topeka
Purchasing Center, Topeka, KS
Patricia Briscoe,
Deputy Director, Business Operations (Pricing
and Information Management).
[FR Doc. 2019–19832 Filed 9–12–19; 8:45 am]
BILLING CODE 6353–01–P
BUREAU OF CONSUMER FINANCIAL
PROTECTION
Consumer Credit Card Market Report
of the Bureau of Consumer Financial
Protection, 2019
Bureau of Consumer Financial
Protection.
ACTION: Consumer Credit Card Market
Report of the Bureau of Consumer
Financial Protection Bureau.
AGENCY:
The Bureau of Consumer
Financial Protection is issuing its fourth
biennial Consumer Credit Card Market
Report to Congress. The report reviews
developments in this consumer market
SUMMARY:
E:\FR\FM\13SEN1.SGM
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48332
Federal Register / Vol. 84, No. 178 / Friday, September 13, 2019 / Notices
since the Bureau’s most recent biennial
report on the same subject in 2017.
DATES: The Bureau released the 2019
Consumer Credit Card Market Report on
its website on August 27, 2019.
FOR FURTHER INFORMATION CONTACT: Wei
Zhang, Credit Card Program Manager,
Division of Research, Markets &
Regulations (wei.zhang@cfpb.gov), or
Austin Mueller, Financial Analyst,
Division of Research, Markets &
Regulations (austin.mueller@cfpb.gov),
or 202–435–7000. If you require this
document in an alternative electronic
format, please contact CFPB_
Accessibility@cfpb.gov.
SUPPLEMENTARY INFORMATION:
khammond on DSKBBV9HB2PROD with NOTICES
Message From Kathleen L. Kraninger,
Director
Credit cards are one of the most
commonly-held and widely-used
financial products in America. At last
count, nearly 170 million Americans
hold credit cards, many of them
carrying more than one. Some
consumers use these strictly as payment
devices, paying their balances in full
each month, while others use them as a
source of credit and carry a balance
from month to month.
The Credit Card Accountability
Responsibility and Disclosure Act
(CARD Act or Act) 1 requires the Bureau
to prepare a biennial report to Congress
regarding the consumer credit card
market. This is the Bureau’s fourth
report, and details findings regarding,
among other things, the cost and
availability of credit and innovations in
the credit card marketplace. The report
also emphasizes that with the passage of
time, it is becoming increasingly
difficult to correlate the CARD Act with
specific effects in the marketplace that
have occurred since the issuance of the
Bureau’s last biennial report, and, even
more so, to demonstrate a causal
relationship between the CARD Act and
those effects. Accordingly, while the
Bureau will continue to report on the
CARD Act’s effects where appropriate
and feasible, the Bureau anticipates
future reports will focus more on overall
conditions in the credit card market.
Evidence-based research like this is
one way in which the Bureau discharges
its statutory duty to monitor for risks to
consumers in the offering or provision
of consumer financial products and
services. It is my hope that the
publication of this report with the latest
data on this important market will be
useful to consumers, providers of credit
card products, and policymakers.
1 Public
Law 111–24, 123 Stat. 1734 (2009).
VerDate Sep<11>2014
17:09 Sep 12, 2019
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1. Consumer Credit Card Market Report
of the Bureau of Consumer Financial
Protection, 2019
1.1 Review Mandate
In May 2009, Congress passed the
CARD Act. The Act made substantial
changes to the credit card market. Its
stated purpose was to ‘‘establish fair and
transparent practices related to the
extension of credit’’ in the credit card
marketplace.2 The Act mandated new
disclosures and underwriting standards,
curbed certain fees, and restricted
certain interest rate increases on
existing balances.3
Among the CARD Act’s many
provisions was a requirement that the
Board of Governors of the Federal
Reserve System (Board) report every two
years ‘‘within the limits of its existing
resources available for reporting
purposes’’ on the consumer credit card
market, including a number of specified
topics.4 With the passage of the DoddFrank Wall Street Reform and Consumer
Protection Act (Dodd-Frank Act) in
2010, that requirement passed to the
Bureau of Consumer Financial
Protection (Bureau) alongside broader
responsibility for administering most of
the CARD Act’s provisions. This is the
fourth report published pursuant to that
obligation, building on prior reports
published by the Bureau in 2013, 2015,
and 2017.5
1.2 Publication
In addition to being delivered to
Congress, the full report is available to
the public on the Bureau’s website at
https://files.consumerfinance.gov/f/
2 Id.
3 A full summary of CARD Act rules implemented
by the Board is at pages 11 through 13 of the
Bureau’s 2013 Report. See Bureau of Consumer Fin.
Prot., Card Act Report, (Oct. 1, 2013) (2013 Report),
https://files.consumerfinance.gov/f/201309_cfpb_
card-act-report.pdf. The Bureau subsequently
reissued these rules without material changes in
December 2011. It has since amended the ability to
pay rules and the fee harvester rules implemented
by the Board. These later changes became effective
in, respectively, May and March, 2013.
4 15 U.S.C. 1616(a) (2012).
5 See 2013 Report, supra note 3; Bureau of
Consumer Fin. Prot., The Consumer Credit Card
Market, (Dec. 2015)(2015 Report), https://
files.consumerfinance.gov/f/201512_cfpb_reportthe-consumer-credit-card-market.pdf; Bureau of
Consumer Fin. Prot., The Consumer Credit Card
Market, (Dec. 2017) (2017 Report), https://
files.consumerfinance.gov/f/documents/cfpb_
consumer-credit-card-market-report_2017.pdf. The
Bureau also held a conference in 2011 in which
numerous market stakeholders contributed
information and perspective on developments in
the credit card market. See Press Release, Bureau
of Consumer Fin. Prot., CFPB Launches Public
Inquiry on the Impact of the Card Act (Dec. 19,
2012), available at https://
www.consumerfinance.gov/about-us/newsroom/
consumer-financial-protection-bureau-launchespublic-inquiry-on-the-impact-of-the-card-act.
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documents/cfpb_consumer-credit-cardmarket-report_2019.pdf.
1.3 Summary of Report
The full 2019 report reviews the state
of the consumer credit card market as of
the end of 2018. In addition to
mandating the Bureau’s biennial review
and report on the market, the Act also
requires the Bureau to ‘‘solicit comment
from consumers, credit card issuers, and
other interested parties’’ in connection
with its review.6 As in past years, the
Bureau has done so through a Request
for Information (RFI) published in the
Federal Register, and the Bureau
discusses specific evidence or
arguments provided by commenters
throughout the report.7
Over the last few years, the credit card
market, the largest U.S. consumer
lending market measured by number of
users, has continued to grow in almost
all dimensions and measures. Market
conditions remain stable, in large part
because of low unemployment, modest
wage growth, and high consumer
confidence in the past two years. Credit
cardholders continue to use their cards
to facilitate transactions, smooth
consumption, and earn rewards, all with
the added security of stringent
limitations on liability. Consumer
satisfaction with credit cards remains
high, while consumers’ debt service
burden remains near its lowest level
recorded in more than a decade.
Late payment and default rates have
risen modestly over this period but
remain below pre-recession levels. In
general, credit card issuers continue to
generate profitable returns consistent
with historical levels. Innovation has
continued to reshape the market, for
both users and providers. New
providers, including large and small
financial institutions as well as startup
and mainstream technology companies
have entered—or are in the process of
entering—the market with competing
products, features, and new ways of
issuing credit cards.8
Since passage of the CARD Act,
researchers, including the Bureau, have
studied the effects of the CARD Act on
the cost and availability of credit to
consumers. This report discusses that
research. However, the Bureau also
emphasizes that with the passage of
time, it is becoming increasingly
6 15
U.S.C. 1616(b) (2012).
for Information Regarding Consumer
Credit Card Market, 84 FR 647 (Jan. 31, 2019).
8 Any reference in the 2019 report (or earlier
reports) to any specific commercial product,
service, firm, or corporation name is for the
information and convenience of the public, and
does not constitute endorsement or
recommendation by the Bureau.
7 Request
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Federal Register / Vol. 84, No. 178 / Friday, September 13, 2019 / Notices
difficult to correlate the CARD Act with
specific effects in the marketplace that
have occurred since the issuance of the
Bureau’s last biennial report, and, even
more so, to demonstrate a causal
relationship between the CARD Act and
those effects. Accordingly, while the
Bureau will continue to report on the
CARD Act’s effects where appropriate
and feasible, the Bureau anticipates that
future reports will focus more on overall
conditions in the credit card market.
Continuing past practice, the 2019
report revisits most of the same baseline
indicators as prior reports to track key
market developments and trends. In
addition, the report reviews significant
findings from economics scholarship
focused on the CARD Act. Below is a
summary of the core findings from each
section of the report:
• Total outstanding credit card
balances have continued to grow and at
year-end 2018 were nominally above
pre-recession levels. Throughout the
post-recession period, including the
period since the Bureau’s 2017 Report,
purchase volume has grown faster than
outstanding balances. After falling to
historical lows in the years following
the recession, delinquency and chargeoff rates have increased over the last two
years. Late payment rates have
increased for new originations of
general purpose and private label cards,
both overall and within different credit
tiers.
• The total cost of credit (TCC) on
revolving accounts has increased over
the last two years and in 2018 stood at
18.7 percent, which is the highest
overall level observed in the Bureau’s
biennial reports. Recent TCC increases
are largely the result of increases in the
indices underlying variable rates, such
as the prime rate. General purpose
cards, which generally have interest
rates linked to the prime rate, have
driven the increase across every credit
tier. TCC has fallen over the last two
years for private label cards, in part
because relatively fewer of these cards
have rates linked directly to index rates,
offset by a decline in fees as a share of
balances.
• Most measures of credit card
availability—overall and across credit
score tiers—have remained stable or
decreased slightly since the Bureau’s
2017 Report. Measured by application
volume, consumer demand for credit
cards peaked in 2016. Approval rates
have also declined slightly since 2016.
Driven by lower approval rates, annual
growth in the number of credit card
accounts opened and the amount of
credit line on new accounts has also
leveled off. Even so, total credit line
across all consumer credit cards reached
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17:09 Sep 12, 2019
Jkt 247001
$4.3 trillion in 2018, nearly equal to its
pre-recession high, largely due to the
growth in unused line on accounts held
by consumers with superprime scores.
• Cardholders have increased their
use of rewards cards, thereby driving up
the cost to industry to fund these
products. The level and consumer cost
of balance transfer and cash advance use
remains largely unchanged.
• In the ten years since the CARD Act
was passed, social scientists have
examined the Act’s effects on
consumers and the credit card market as
a whole. Using a range of theoretical
and empirical approaches, scholarship
has looked at a range of potential direct
and indirect effects of the CARD Act,
including pricing, credit availability,
consumer repayment behavior, and
cardholding.
• Since the 2017 Report, issuers have
lowered the range of their daily limits
on debt collection phone calls for
delinquent credit card accounts. In
addition, over that same period, the
volume of balances settled through forprofit debt settlement companies (DSCs)
grew at a faster rate than issuers’ overall
accounts receivable did.
• New technologies further enhance
consumers’ interactions with and
control over their credit cards—from
originating one card rather than another,
to ways of transacting and paying.
Cardholders increasingly use and
service their cards through digital
portals, including those accessed via
mobile devices. New technologies such
as artificial intelligence and machine
learning, as well as new data sources,
are changing how providers are able to
manage risk and provide customer
service.
1.4 Regulatory Agenda
As discussed in its Unified Agenda
for Spring 2019, the Bureau is
undertaking initiatives to review
inherited regulations for the purpose of
ensuring that outdated, unnecessary, or
unduly burdensome regulations are
regularly identified and addressed in
order to reduce unwarranted regulatory
burdens, as well as to fulfill other
purposes and objectives of the Bureau
and the statutes enumerated in the
Dodd-Frank Wall Street Reform and
Consumer Protection Act, including the
Truth In Lending Act (TILA), wherein
the CARD Act is codified.9 As part of its
long-term agenda, the Bureau expects to
focus on subparts B and G of Regulation
Z, which implement the Truth in
Lending Act with respect to open-end
9 See https://www.reginfo.gov/public/do/
eAgendaViewRule?pubId=201904&RIN=3170AA73.
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48333
credit generally and credit cards in
particular. For instance, the Bureau
expects to consider rules to modernize
the procedures for submitting credit
card agreements to the database of credit
card agreements that it is required to
maintain under the CARD Act to reduce
burden on issuers that submit credit
card agreements to the Bureau and make
the database more useful for consumers
and the general public. The Bureau
expects to identify other opportunities
to clarify ambiguities, address
developments in the marketplace, and
modernize or streamline the open-end
credit provisions. That effort will be
informed by the Bureau’s ongoing
monitoring of the consumer credit card
market, including the 2019 report.
Dated: August 16, 2019.
Kathleen L. Kraninger,
Director, Bureau of Consumer Financial
Protection.
[FR Doc. 2019–19811 Filed 9–12–19; 8:45 am]
BILLING CODE 4810–AM–P
DEPARTMENT OF EDUCATION
Privacy Act of 1974; Matching Program
Department of Education.
Notice of a New Matching
Program.
AGENCY:
ACTION:
This document provides
notice of the re-establishment of a
matching program between the
Department of Education (Department
or ED) and the Department of Homeland
Security, U.S. Citizenship and
Immigration Services (USCIS). ED seeks
access to the information contained in
the DHS–USCIS database (referred to as
the Verification Information System
(VIS)) for the purpose of verifying the
immigration status of applicants for
assistance for title IV federal student
aid.
SUMMARY:
Submit your comments on the
proposed matching program on or
before October 15, 2019.
The matching program will go into
effect at the later of the following two
dates: (1) October 21, 2019, or (2) 30
days after the publication of this notice,
on September 13, 2019, unless
comments have been received from
interested members of the public
requiring modification and replication
of the notice. The matching program
will continue for 18 months after the
effective date and may be extended for
an additional 12 months, if the
respective Data Integrity Boards (DIBs)
of the Department and USCIS determine
that the conditions specified in 5 U.S.C.
552a(o)(2)(D) have been met.
DATES:
E:\FR\FM\13SEN1.SGM
13SEN1
]]>Agencies
[Federal Register Volume 84, Number 178 (Friday, September 13, 2019)]
[Notices]
[Pages 48331-48333]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-19811]
=======================================================================
-----------------------------------------------------------------------
BUREAU OF CONSUMER FINANCIAL PROTECTION
Consumer Credit Card Market Report of the Bureau of Consumer
Financial Protection, 2019
AGENCY: Bureau of Consumer Financial Protection.
ACTION: Consumer Credit Card Market Report of the Bureau of Consumer
Financial Protection Bureau.
-----------------------------------------------------------------------
SUMMARY: The Bureau of Consumer Financial Protection is issuing its
fourth biennial Consumer Credit Card Market Report to Congress. The
report reviews developments in this consumer market
[[Page 48332]]
since the Bureau's most recent biennial report on the same subject in
2017.
DATES: The Bureau released the 2019 Consumer Credit Card Market Report
on its website on August 27, 2019.
FOR FURTHER INFORMATION CONTACT: Wei Zhang, Credit Card Program
Manager, Division of Research, Markets & Regulations
([email protected]), or Austin Mueller, Financial Analyst, Division of
Research, Markets & Regulations ([email protected]), or 202-435-
7000. If you require this document in an alternative electronic format,
please contact [email protected].
SUPPLEMENTARY INFORMATION:
Message From Kathleen L. Kraninger, Director
Credit cards are one of the most commonly-held and widely-used
financial products in America. At last count, nearly 170 million
Americans hold credit cards, many of them carrying more than one. Some
consumers use these strictly as payment devices, paying their balances
in full each month, while others use them as a source of credit and
carry a balance from month to month.
The Credit Card Accountability Responsibility and Disclosure Act
(CARD Act or Act) \1\ requires the Bureau to prepare a biennial report
to Congress regarding the consumer credit card market. This is the
Bureau's fourth report, and details findings regarding, among other
things, the cost and availability of credit and innovations in the
credit card marketplace. The report also emphasizes that with the
passage of time, it is becoming increasingly difficult to correlate the
CARD Act with specific effects in the marketplace that have occurred
since the issuance of the Bureau's last biennial report, and, even more
so, to demonstrate a causal relationship between the CARD Act and those
effects. Accordingly, while the Bureau will continue to report on the
CARD Act's effects where appropriate and feasible, the Bureau
anticipates future reports will focus more on overall conditions in the
credit card market.
---------------------------------------------------------------------------
\1\ Public Law 111-24, 123 Stat. 1734 (2009).
---------------------------------------------------------------------------
Evidence-based research like this is one way in which the Bureau
discharges its statutory duty to monitor for risks to consumers in the
offering or provision of consumer financial products and services. It
is my hope that the publication of this report with the latest data on
this important market will be useful to consumers, providers of credit
card products, and policymakers.
1. Consumer Credit Card Market Report of the Bureau of Consumer
Financial Protection, 2019
1.1 Review Mandate
In May 2009, Congress passed the CARD Act. The Act made substantial
changes to the credit card market. Its stated purpose was to
``establish fair and transparent practices related to the extension of
credit'' in the credit card marketplace.\2\ The Act mandated new
disclosures and underwriting standards, curbed certain fees, and
restricted certain interest rate increases on existing balances.\3\
---------------------------------------------------------------------------
\2\ Id.
\3\ A full summary of CARD Act rules implemented by the Board is
at pages 11 through 13 of the Bureau's 2013 Report. See Bureau of
Consumer Fin. Prot., Card Act Report, (Oct. 1, 2013) (2013 Report),
https://files.consumerfinance.gov/f/201309_cfpb_card-act-report.pdf.
The Bureau subsequently reissued these rules without material
changes in December 2011. It has since amended the ability to pay
rules and the fee harvester rules implemented by the Board. These
later changes became effective in, respectively, May and March,
2013.
---------------------------------------------------------------------------
Among the CARD Act's many provisions was a requirement that the
Board of Governors of the Federal Reserve System (Board) report every
two years ``within the limits of its existing resources available for
reporting purposes'' on the consumer credit card market, including a
number of specified topics.\4\ With the passage of the Dodd-Frank Wall
Street Reform and Consumer Protection Act (Dodd-Frank Act) in 2010,
that requirement passed to the Bureau of Consumer Financial Protection
(Bureau) alongside broader responsibility for administering most of the
CARD Act's provisions. This is the fourth report published pursuant to
that obligation, building on prior reports published by the Bureau in
2013, 2015, and 2017.\5\
---------------------------------------------------------------------------
\4\ 15 U.S.C. 1616(a) (2012).
\5\ See 2013 Report, supra note 3; Bureau of Consumer Fin.
Prot., The Consumer Credit Card Market, (Dec. 2015)(2015 Report),
https://files.consumerfinance.gov/f/201512_cfpb_report-the-consumer-credit-card-market.pdf; Bureau of Consumer Fin. Prot., The Consumer
Credit Card Market, (Dec. 2017) (2017 Report), https://files.consumerfinance.gov/f/documents/cfpb_consumer-credit-card-market-report_2017.pdf. The Bureau also held a conference in 2011 in
which numerous market stakeholders contributed information and
perspective on developments in the credit card market. See Press
Release, Bureau of Consumer Fin. Prot., CFPB Launches Public Inquiry
on the Impact of the Card Act (Dec. 19, 2012), available at https://www.consumerfinance.gov/about-us/newsroom/consumer-financial-protection-bureau-launches-public-inquiry-on-the-impact-of-the-card-act.
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1.2 Publication
In addition to being delivered to Congress, the full report is
available to the public on the Bureau's website at https://files.consumerfinance.gov/f/documents/cfpb_consumer-credit-card-market-report_2019.pdf.
1.3 Summary of Report
The full 2019 report reviews the state of the consumer credit card
market as of the end of 2018. In addition to mandating the Bureau's
biennial review and report on the market, the Act also requires the
Bureau to ``solicit comment from consumers, credit card issuers, and
other interested parties'' in connection with its review.\6\ As in past
years, the Bureau has done so through a Request for Information (RFI)
published in the Federal Register, and the Bureau discusses specific
evidence or arguments provided by commenters throughout the report.\7\
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\6\ 15 U.S.C. 1616(b) (2012).
\7\ Request for Information Regarding Consumer Credit Card
Market, 84 FR 647 (Jan. 31, 2019).
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Over the last few years, the credit card market, the largest U.S.
consumer lending market measured by number of users, has continued to
grow in almost all dimensions and measures. Market conditions remain
stable, in large part because of low unemployment, modest wage growth,
and high consumer confidence in the past two years. Credit cardholders
continue to use their cards to facilitate transactions, smooth
consumption, and earn rewards, all with the added security of stringent
limitations on liability. Consumer satisfaction with credit cards
remains high, while consumers' debt service burden remains near its
lowest level recorded in more than a decade.
Late payment and default rates have risen modestly over this period
but remain below pre-recession levels. In general, credit card issuers
continue to generate profitable returns consistent with historical
levels. Innovation has continued to reshape the market, for both users
and providers. New providers, including large and small financial
institutions as well as startup and mainstream technology companies
have entered--or are in the process of entering--the market with
competing products, features, and new ways of issuing credit cards.\8\
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\8\ Any reference in the 2019 report (or earlier reports) to any
specific commercial product, service, firm, or corporation name is
for the information and convenience of the public, and does not
constitute endorsement or recommendation by the Bureau.
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Since passage of the CARD Act, researchers, including the Bureau,
have studied the effects of the CARD Act on the cost and availability
of credit to consumers. This report discusses that research. However,
the Bureau also emphasizes that with the passage of time, it is
becoming increasingly
[[Page 48333]]
difficult to correlate the CARD Act with specific effects in the
marketplace that have occurred since the issuance of the Bureau's last
biennial report, and, even more so, to demonstrate a causal
relationship between the CARD Act and those effects. Accordingly, while
the Bureau will continue to report on the CARD Act's effects where
appropriate and feasible, the Bureau anticipates that future reports
will focus more on overall conditions in the credit card market.
Continuing past practice, the 2019 report revisits most of the same
baseline indicators as prior reports to track key market developments
and trends. In addition, the report reviews significant findings from
economics scholarship focused on the CARD Act. Below is a summary of
the core findings from each section of the report:
Total outstanding credit card balances have continued to
grow and at year-end 2018 were nominally above pre-recession levels.
Throughout the post-recession period, including the period since the
Bureau's 2017 Report, purchase volume has grown faster than outstanding
balances. After falling to historical lows in the years following the
recession, delinquency and charge-off rates have increased over the
last two years. Late payment rates have increased for new originations
of general purpose and private label cards, both overall and within
different credit tiers.
The total cost of credit (TCC) on revolving accounts has
increased over the last two years and in 2018 stood at 18.7 percent,
which is the highest overall level observed in the Bureau's biennial
reports. Recent TCC increases are largely the result of increases in
the indices underlying variable rates, such as the prime rate. General
purpose cards, which generally have interest rates linked to the prime
rate, have driven the increase across every credit tier. TCC has fallen
over the last two years for private label cards, in part because
relatively fewer of these cards have rates linked directly to index
rates, offset by a decline in fees as a share of balances.
Most measures of credit card availability--overall and
across credit score tiers--have remained stable or decreased slightly
since the Bureau's 2017 Report. Measured by application volume,
consumer demand for credit cards peaked in 2016. Approval rates have
also declined slightly since 2016. Driven by lower approval rates,
annual growth in the number of credit card accounts opened and the
amount of credit line on new accounts has also leveled off. Even so,
total credit line across all consumer credit cards reached $4.3
trillion in 2018, nearly equal to its pre-recession high, largely due
to the growth in unused line on accounts held by consumers with
superprime scores.
Cardholders have increased their use of rewards cards,
thereby driving up the cost to industry to fund these products. The
level and consumer cost of balance transfer and cash advance use
remains largely unchanged.
In the ten years since the CARD Act was passed, social
scientists have examined the Act's effects on consumers and the credit
card market as a whole. Using a range of theoretical and empirical
approaches, scholarship has looked at a range of potential direct and
indirect effects of the CARD Act, including pricing, credit
availability, consumer repayment behavior, and cardholding.
Since the 2017 Report, issuers have lowered the range of
their daily limits on debt collection phone calls for delinquent credit
card accounts. In addition, over that same period, the volume of
balances settled through for-profit debt settlement companies (DSCs)
grew at a faster rate than issuers' overall accounts receivable did.
New technologies further enhance consumers' interactions
with and control over their credit cards--from originating one card
rather than another, to ways of transacting and paying. Cardholders
increasingly use and service their cards through digital portals,
including those accessed via mobile devices. New technologies such as
artificial intelligence and machine learning, as well as new data
sources, are changing how providers are able to manage risk and provide
customer service.
1.4 Regulatory Agenda
As discussed in its Unified Agenda for Spring 2019, the Bureau is
undertaking initiatives to review inherited regulations for the purpose
of ensuring that outdated, unnecessary, or unduly burdensome
regulations are regularly identified and addressed in order to reduce
unwarranted regulatory burdens, as well as to fulfill other purposes
and objectives of the Bureau and the statutes enumerated in the Dodd-
Frank Wall Street Reform and Consumer Protection Act, including the
Truth In Lending Act (TILA), wherein the CARD Act is codified.\9\ As
part of its long-term agenda, the Bureau expects to focus on subparts B
and G of Regulation Z, which implement the Truth in Lending Act with
respect to open-end credit generally and credit cards in particular.
For instance, the Bureau expects to consider rules to modernize the
procedures for submitting credit card agreements to the database of
credit card agreements that it is required to maintain under the CARD
Act to reduce burden on issuers that submit credit card agreements to
the Bureau and make the database more useful for consumers and the
general public. The Bureau expects to identify other opportunities to
clarify ambiguities, address developments in the marketplace, and
modernize or streamline the open-end credit provisions. That effort
will be informed by the Bureau's ongoing monitoring of the consumer
credit card market, including the 2019 report.
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\9\ See https://www.reginfo.gov/public/do/eAgendaViewRule?pubId=201904&RIN=3170-AA73.
Dated: August 16, 2019.
Kathleen L. Kraninger,
Director, Bureau of Consumer Financial Protection.
[FR Doc. 2019-19811 Filed 9-12-19; 8:45 am]
BILLING CODE 4810-AM-P
