A recent ruling by a Texas judge has nullified a federal rule proposed by the Consumer Finance Protection Bureau (CFPB) that aimed to cap credit card late fees at $8. This rule was anticipated to save American households over $10 billion annually. However, banks argued that such a cap would weaken their ability to deter late payments. The ruling coincides with new agreements among industry groups and the CFPB to discard the proposed fee limit, keeping the average late fee at around $32.
The Texas judge's ruling earlier this month came a day after major industry groups announced they had reached an agreement to throw out the $8 late fee cap.
The CFPB estimated that American families would have saved more than $10 billion in late fees annually had the fees been capped at $8.
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