The CFPB’s New Credit Card Agreement

The Consumer Financial Protection Bureau doesn’t have a confirmed head and thus lacks most regulatory authority, but it’s still doing stuff. Today, for example, they rolled out this excellent model two page credit card agreement that will initially be used at the Pentagon Federal Credit Union but that they’re hoping will become industry standard some day. I’ve pasted a section of it here above, but you should really check out the whole thing. It makes for an interesting exercise.

Basically what they did was sit down and try to apply some basic design principles to the question “how can we convey to consumers information about their credit card.” Currently the way credit card agreements are written is more like the reverse, they apply basic design principles to the question “how can we maximize the chances that consumers will neglect something or get confused while meeting our technical legal obligations toward disclosure.” In an increasingly attention-constrained world, these kind of design questions around disclosure rules matter more and more.