WASHINGTON, July 16 (Reuters) - The U.S. consumer finance watchdog on Wednesday proposed publishing on its website individuals’ stories about bad experiences with credit cards, student loans and other financial services, prompting quick pushback from banks.
The Consumer Financial Protection Bureau already posts basic details of consumer complaints about an array of products. It also passes the information along to the financial firms and provides updates when the issues are resolved.
Now, the agency wants to include customers’ full explanations of what happened.
“The narrative supplies vital information about why the consumer believes they were harmed, and how the problem has affected the consumer’s life,” CFPB Director Richard Cordray said.
The CFPB said including the narrative in its database would provide more information, such as whether the consumer faced extra fees, and help users spot trends with companies or in regions.
The database would not include personal information, and borrowers would have to agree to share their stories. Companies featured in the complaints would have an opportunity to respond.
Banks and other financial service providers have criticized the complaint database, which they say unfairly hurts firms’ reputations.
“Banks have an obligation to their customers to maintain the confidentiality of their information, making it virtually impossible for a bank to offer a complete response to these narratives,” Richard Hunt, chief executive of the Consumer Bankers Association, said in a statement on Wednesday.
Financial firms will have 30 days to comment on the CFPB’s proposed changes to its database. To date, the bureau has handled more than 400,000 consumer complaints. (Reporting by Emily Stephenson; Editing by Dan Grebler)