President Joe Biden on Wednesday unveiled fresh efforts to slash credit card late fees and drive down the prices that Apple Inc (AAPL.O) and Google parent Alphabet Inc (GOOGL.O) charge on mobile app stores.
The move is part of a larger policy drive to promote competition in consumer markets, officials said.
Speaking at the White House, Biden also called on lawmakers to ban “junk fees” he said jacked up costs for consumer services such as accommodation, concert tickets, mobile plans and air travel, in which officials said air carriers can charge family members extra to be seated next to young children.
Biden has been beating the drum on inflation, criticizing Republicans who now control the House of Representatives for backing tax measures that he said would benefit the wealthy at the expense of middle-class taxpayers.
Biden, who is expected to announce a bid for re-election in the coming weeks, has also been slamming Republicans for their refusal to approve an increase in the U.S. debt ceiling unless there is a deal on spending cuts.
Wednesday’s announcement coincides with a scheduled meeting between Biden and House Speaker Kevin McCarthy that is likely to mark the start of protracted manoeuvring on raising the $31.4 trillion borrowing cap.
As part of the initiative, the Consumer Financial Protection Bureau on Wednesday proposed a rule to ban “excessive” fees that credit card issuers charge for late payments, something the bureau estimated costs consumers $12 billion a year.
Speaking at Biden’s side, CFPB Director Rohit Chopra said such fees far exceeded any additional costs that lenders incurred.
The CFPB said the rule would cap late fees at $8, whereas officials estimate they currently average $31, something that could represent as much as $9 billion in consumer savings a year.
The rule could take effect in 2024 after a comment period, according to Chopra. However, regulations are frequently subject to challenge and litigation by industry groups that can block or delay them.
The National Telecommunications and Information Administration (NTIA), an arm of the Commerce Department, released a report on Wednesday denouncing the market dominance enjoyed by Apple and Google in the app economy, where the vast majority of smartphone users and developers are hemmed inside the tech giants’ software ecosystems, which the NTIA said drives up costs and limits innovation.
The report calls for greater user control over which applications are available, an end to platform operators’ “self-preference” for their own apps, and a ban on requirements that apps use the operators’ in-app payments systems.
An Apple spokesperson said in a statement that while the report “acknowledges the importance of user privacy, data security and user convenience,” some of its conclusions “ignore the investments we make in innovation, privacy and security.”
Google also disagreed with the report’s findings, saying through a spokesperson that its Android system “enables more choice and competition than any other mobile operating system.”
Meanwhile, the White House said Wednesday the Transportation Department will propose regulations to bar airlines from charging family members to be seated next to children aged 13 or younger and will disclose on a government dashboard which airlines do not charge such fees, the White House said.
Wednesday’s announcements will mark the fourth meeting of Biden’s Competition Council, created in 2021 when consumer inflation was at 40-year highs and was widely seen as a political headwind ahead of the 2022 midterm elections.