US President Donald Trump on Wednesday signed into law legislation that eliminates the flat rate for most consumer credit cards, as well as a variety of other fees and surcharges, in the United State.
The new rules will apply to all major credit cards and auto loans, including the ones that are currently the primary way Americans can access credit.
Trump also signed an executive order that eliminated some of the requirements that apply to credit cards for consumers who have outstanding balances.
The move was prompted by a wave of consumer credit card and auto loan defaults and lawsuits.
The Consumer Financial Protection Bureau estimates that roughly one in five Americans have outstanding consumer credit debt.
As part of the new rules, credit cards are not subject to the flat-rate fee for purchases made with cash, as is currently the case for most of the credit card industry.
Instead, consumers will be charged a flat rate of 25 cents on purchases made in cash.
A single purchase with cash will now cost 25 cents, up from 25 cents.
The change also eliminates the fee that is charged by banks and credit card companies when customers attempt to apply for new or renewal cards.
In addition, credit card purchases are now subject to an annual fee that varies depending on the issuer, with the new fee being $10 per transaction, or $10.50 for a $200 transaction.
The flat-fee rules are similar to those that were passed in the wake of the Great Recession.
But unlike those, the new rule does not apply to loans that are offered by traditional banks or to any kind of auto loan.