The CFPB issued its Monthly Report this week. The report is a high level snapshot of trends in consumer complaints and provides a summary of the volume of complaints by product category, by company and by state. Additionally, each month it highlights a product type and a geographic area. This month’s report highlights prepaid card products and emphasizes the CFPB’s concern for the unbanked and underbanked population. Cordray noted that for the unbanked and underbanked, “prepaid products are a vital source of financial security.” CFPB Monthly Complaint Snapshot Highlights Prepaid Product Complaints.
NATIONAL OUTLOOK. Each month, the Report breaks down complaint volume by product looking at a three month average and comparing the same to the prior year. Student loan complaints showed the greatest percentage increase when compared to the same period of 2015, increasing 96% over last year. As has been the case in prior months, the Report continues to indicate that the three products yielding the highest volume of complaints on a month to month basis are debt collection, mortgage and credit reporting. Together, they represent about 63% of all complaints submitted in September.
FEATURED PRODUCT OR SERVICE. This month’s report focuses on prepaid cards which, aside from “other financial service”, comprise the smallest percentage of complaints received by the CFPB for September and continue to remain toward the bottom of the list overall. Put simply, prepaid product complaints make up less than 1% of all complaints received by the CFPB.
The most common issues identified by consumers are managing, opening or closing an account and unauthorized transactions or other transaction issues. Specifically,
- According to the report, consumers complained of questionable transactions being posted to their prepaid cards and claimed their cards were cancelled without notification after they submitted a dispute;
- Consumers also reported difficulty using prepaid cards after purchase and being asked to submit validating documentation; and
- Consumers also complained about receiving prepaid cards as a refund, but being unable to activate the card, access the funds or both.
NORTH CAROLINA. As it does every month, the Report spotlights a geographic area. This month, the Report shined its bright light on North Carolina and the complaint trends for both the state and the Charlotte metropolitan area. For perspective, only about 3% of all complaints received by the CFPB originate in North Carolina. The most complained of products and services mirror the national picture with mortgage, debt collection and credit reporting comprising the vast majority of all complaints. As noted by the CFPB, the rate of mortgage related complaints is slightly higher than the national average and it is the most frequently complained of product in North Carolina.