US watchdog warns credit card issuers not to devalue rewards [View all]
Source: Reuters
December 18, 2024 12:34 PM EST Updated 2 hours ago
Dec 18 (Reuters) - Credit card companies that devalue or cancel the rewards points, cash back or miles that cardholders have earned may be breaking the law, the top U.S. watchdog agency for consumer finance warned on Wednesday.
In a policy circular, the U.S. Consumer Financial Protection Bureau said prohibitions against unfair, deceptive and abusive practices mean authorities may punish card issuers that slash the value of such rewards based on fine print, hidden terms or technical glitches.
The CFPB distributes such circulars to other agencies, including state attorneys general and local regulators, that enforce federal consumer financial laws.
As of 2022, three-quarters of all general-purpose credit cards were rewards cards and many consumers choose which to apply for and use based on the rewards offered, according to the CFPB.
Read more: https://www.reuters.com/business/finance/us-watchdog-warns-credit-card-issuers-not-devalue-rewards-2024-12-18/
Link to CFPB CIRCULAR - Consumer Financial Protection Circular 2024-07 Design, marketing, and administration of credit card rewards programs
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