Regulatory and Legal Updates: What Recent CFPB Actions Mean for Your Money

The Consumer Financial Protection Bureau has been unusually active over the past two years — finalizing rules on overdraft fees, open banking data rights, medical debt credit reporting, credit card late fees, and BNPL regulation. Several of these rules face legal challenges and political uncertainty that may alter or delay implementation. Understanding which rules are currently in effect, which are contested, and what each means for consumers who carry credit and maintain bank accounts is practical information that affects real financial decisions.

Overdraft Fee Cap

In late 2024, the CFPB finalized a rule capping overdraft fees at $5 for large banks — institutions with more than $10 billion in assets. Banks could alternatively charge a fee that covers their costs (without profit) or a fee disclosed transparently as the APR equivalent. The banking industry, which collects approximately $8 billion annually in overdraft fees primarily from large banks, immediately challenged the rule in federal court. As of early 2025, the rule's implementation is uncertain pending litigation. Community banks and credit unions below the $10 billion threshold are not covered by the rule.

Credit Card Late Fee Limits

The CFPB finalized a rule in 2024 reducing the safe harbor for credit card late fees from $30 (first occurrence) and $41 (subsequent) to $8 — also applicable to large card issuers. The banking industry sued, and a federal court in Texas issued a stay blocking implementation. The rule has not taken effect. Under current rules, credit card late fees can still reach $30 for first occurrences and $41 for subsequent ones. The litigation will likely continue into 2026 or beyond.

Open Banking: Your Right to Your Financial Data

The CFPB's Section 1033 rule, finalized in October 2024, established the right for consumers to access and share their financial data in machine-readable format — and to revoke that access at any time. Banks must provide authorized third parties (budgeting apps, competing banks, lenders) with standardized data access through secure APIs, phasing out screen-scraping. The rule phases in over four years, with large banks required to comply first. This is a foundational change for how consumers can use their financial data — making it easier to switch banks, compare offers, and grant or revoke data access to apps.

Medical Debt and Credit Reports

The CFPB finalized a rule in early 2025 to remove medical debt from credit reports entirely, arguing that medical debt is a poor predictor of credit risk and unfairly penalizes consumers for health emergencies outside their control. The rule faces legal challenge from the credit reporting industry and affected hospitals. The CFPB estimates that removal would raise affected consumers' credit scores by an average of 20 points. Whether the rule survives depends on the regulatory and legal environment through 2025 and 2026.

What These Changes Mean for You

The regulatory picture is genuinely uncertain — rules that were finalized may not be implemented if courts stay them or if the regulatory posture of the CFPB shifts. Don't make financial decisions based on anticipated regulatory changes that haven't taken effect. Check current credit report status at AnnualCreditReport.com rather than assuming medical debt has been removed. Assume overdraft fees remain at current levels until a court confirms otherwise. Know your existing rights: the ability to opt out of overdraft coverage for debit and ATM transactions, the right to dispute errors on your credit report, and the FDCPA protections against debt collector harassment are current law not subject to pending litigation.