CFPB report on consumer complaints about card rewards programs

The CFPB has announced its release of a new Issue Spotlight report, "Credit Card Rewards" finding consumers encounter numerous frustrations with credit card rewards programs.

The report indicates that consumer complaints include that rewards are often devalued or denied even after program terms are met and that credit card companies focus marketing efforts on rewards, like cash back and travel, instead of on low interest rates and fees. Consumers who carry revolving balances complain they often pay far more in interest and fees than they get back on rewards and credit card companies often use rewards programs as a “bait and switch” by burying terms in vague language or fine print and changing the value of rewards after people sign up and earn them. New problems have been created by the growth of co-brand credit cards and rewards programs where consumers can transfer miles or points to merchants.