According to the just-released Compliance Professionals Forum report on convenience fee use, over three-quarters of the industry have chosen not to assess convenience fees – primarily because they have no appetite for the compliance risks associated with them. (These are mostly centered on UDAAP concerns: Can an agency prove that they are agnostic when applying a convenience fee? If one consumer argues out of the fee, can you legally charge it to the next consumer?) Those who still charge aren't necessarily eager to do so; many agencies surveyed charge a convenience fee either because they cannot stay profitable without doing so, or because their clients have made it a requirement for collecting their paper.
The top reason why firms don't charge convenience fees? Here they are, listed from most common to least common reasons:
- The risk exposure is too high.
- We absorb the cost because we consider it a cost of doing business.
- We can't find a compliant way to pass along the cost.
- Our clients disallow it.
The full study - complete with infographics, narrative responses to survey questions and convenience fee policies - is available to Compliance Professionals Forum members, who can get it here.
Not a member? Find out how to join right here.