DES MOINES, Iowa (11/19/12)--Although the Consumer Financial Protection Bureau has heavily focused on mortgages since its inception, credit and debit cards are likely to become a priority for the agency, according to a new white paper from The Members Group (TMG) and PolicyWorks.
"Attention to consumer protections on cards is gaining steam as battles continue over interchange issues," write co-authors Dan Lozier, TMG director of client relations, and Jeff Andersen, PolicyWorks regulatory counsel. "On the credit side of the coin, a proposed settlement of more than $6 billion, offered by Visa, MasterCard and other major banks to pay for price-fixing claims brought by merchants, continues to make headlines as various stakeholders argue their side of the matter."
The CFPB continues to question the adequacy of disclosures, according to the paper, titled "How the CFPB Will Impact Your Community Financial Institution in 2013." Card issuers' marketing of various add-on products is another area under significant scrutiny by the CFPB. These products can include debt protection, identity theft protection, credit score tracking and others supplementary to the credit provided by the card itself, said the authors.
The CFPB's Consumer Complaint Database could have a positive effect for credit unions that issue cards, according to the paper.
"In fact, the Green Internet Group, a company specializing in online reputation management, believes 70% of Americans now say they consult product reviews or consumer ratings before they make their buying decisions," the paper said. "If consumers use the Consumer Complaint Database similar to how they use consumer reviews to evaluate bank cards, those products issued by credit unions and community banks have the potential to stand out from competitors."