What Are Junk Fees And Will They Finally Be Banned?

Will a new proposal from the President finally put an end to a junk fee industry that rakes in over $50b per year?

What Are Junk Fees And Will They Finally Be Banned?
Americans are throwing away more than $50b per year on junk fees. Can a new proposal fix this?

You hate 'em, industries love 'em, and it's no wonder. With over $50b/yr in junk fees across all of the industries, what isn't to love if you're collecting the money!

Unfortunately for these industries Americans are fed up with footing the bill for deceptive, hidden fees and the government isn't standing for it.

Thanks to a recent proposal, the government might finally fix this junk fee problem for good. Well, at least we can hope.

Biden’s New Junk Fee Proposal

President Biden's plan to tackle "junk fees" in several industries, including airlines, banks, and rental cars was kicked off in his recent State of the Union addressed and backed up by this proposal.

The newly proposed rules would require companies to be more transparent about the fees they charge, and would give consumers more options to avoid these fees.

In the airline industry, the Department of Transportation is considering regulations that would require airlines and online travel agencies to disclose all fees up front and make it easier for customers to compare prices across different providers.

The DOT states airlines collected over $7 billion in fees for services such as baggage, seat assignments, and ticket changes in 2022.

In the banking industry, the Consumer Financial Protection Bureau (CFPB) is proposing rules that would require banks to disclose all fees (PDF)  associated with their accounts, including overdraft fees, ATM fees, and other charges.

CFPB notes that banks collected over $11 billion in overdraft fees alone in 2022, and that the aggregate total of junk fees collected cost Americans over $24b per year! WOW!

In the rental car industry, the Federal Trade Commission (FTC) is investigating the practice of "predatory tolling (PDF)" where rental car companies charge customers inflated fees for using toll roads.

The FTC claims rental car companies collected over $3 billion in fees for tolls and other charges in 2022.

In the healthcare industry, the Centers for Medicare & Medicaid Services (CMS) is proposing rules that would require hospitals to provide a clear and understandable estimate of the cost of their services to patients (PDF) before they receive care.

The CMS says surprise medical bills and other unexpected fees can cause significant financial harm to patients and their families.

In the telecommunications industry, the Federal Communications Commission (FCC) is proposing rules that would require phone and internet providers to disclose all fees up front and give consumers the ability to easily compare the total cost of different plans.

The FCC feels consumers are confused by the complex and opaque pricing structures used by these providers.

According to a report by the American Hotel and Lodging Association (PDF) (AH&LA), hotel fees and surcharges in the U.S. reached a record $4.9 billion in 2019, and these fees have been a source of frustration for consumers in recent years.

Some common examples of hotel industry junk fees include resort fees, early check-in fees, late check-out fees, Wi-Fi fees, parking fees, and amenity fees.

With all of these added costs, is it any wonder why push finally came to shove?

Something clearly has to be done about this, or millions will continue being burdened by hefty fees, and if you didn’t know, the people who can least afford it (especially with banking) are hit the hardest.

So, What’s Happening Now?

As you can imagine, the industry’s are not taking this lying down. They have a golden goose and they aren’t about to give it up without a fight!

Here’s an example of the a recent issue in the hotel industry where Online Travel Agencies (OTA’s) and the hotels themselves are simply not on the same page when it comes to fee transparency, or elimination altogether.

There’s an ongoing dispute between hotels and online travel agencies (OTAs) over the collection and disclosure of "junk fees" or mandatory resort fees charged by hotels. These fees are often added to the advertised room rate and are charged for amenities such as access to the pool, gym, or Wi-Fi…consumers hate this. I know I do!

Related note: You might notice that sites like AirBnB were starting to have some very deceptive advertised rates up until a change recently. The listed price was never the final price after fees until you prepared to book the property!

The major OTAs, including Expedia, Booking.com, and TripAdvisor, have been pressuring hotels to include resort fees in the advertised room rate so that consumers can more easily compare prices across different hotels. Some hotels have resisted this pressure, arguing that including the resort fee in the advertised rate would make their prices look less competitive and could lead to a decline in bookings. Yeah, I mean, why provide transparency when you can just trick people, right? I like that the OTA’s are fighting for this, but they won’t win.

However, the FTC might.

The Federal Trade Commission (FTC) has been investigating the use of resort fees in the hotel industry and has issued warning letters to hotels that fail to disclose these fees properly. The FTC has also called on hotels to provide more transparent pricing information to consumers.

When nearly $5,000,000,000 (five billion dollars) is on the line, there’s bound to be a disagreement or two.

50 Common Junk Fees

Note, not all of these fees are considered “junk fees” by everyone, however, the term junk fee is commonly used to explain unnecessary or costly add-on fees that are difficult to identify or dispute. Basically, if it feels excessive and it surprises you…it’s a junk fee.

  1. Processing fees for mortgage applications
  2. Credit report fees for apartment rentals
  3. Document fees for car sales
  4. Subscription cancellation fees
  5. Convenience fees for paying bills online or over the phone
  6. ATM fees for using an out-of-network machine
  7. Late fees for credit card payments
  8. Overdraft fees for bank accounts
  9. Baggage fees for airline travel
  10. Resort fees for hotel stays
  11. Activation fees for cell phone contracts
  12. Early termination fees for contracts or subscriptions
  13. Service fees for deliveries or installations
  14. Upgrade fees for software or technology products
  15. "Doc prep" fees for legal documents
  16. Convenience fees for buying event tickets
  17. Brokerage fees for stock trades
  18. Inspection fees for used car purchases
  19. Application fees for credit cards or loans
  20. Premium fees for faster shipping or processing
  21. Exchange fees for currency conversions
  22. Membership fees for loyalty programs
  23. Administration fees for healthcare services
  24. Foreign transaction fees for credit card purchases
  25. Inactivity fees for bank accounts or gift cards
  26. Car rental fuel charges
  27. Additional driver fees for car rentals
  28. Pet fees for rental properties or hotels
  29. Connection fees for utility services
  30. Clean-up fees for event or vacation rentals
  31. Redemption fees for reward programs
  32. Equipment rental fees for home services
  33. Tax preparation fees for filing taxes
  34. Rescheduling fees for appointments or travel
  35. Repair fees for damaged products or properties
  36. Upgrade fees for airplane seating or rental cars
  37. Account maintenance fees for brokerage accounts
  38. Storage fees for personal belongings
  39. Access fees for public Wi-Fi
  40. Referral fees for business or real estate transactions
  41. Activation fees for credit cards or gift cards
  42. Courier fees for shipping documents or packages
  43. Pay-to-skip-the-line fees for amusement parks or attractions
  44. Upgrade fees for hotel rooms or airline seats
  45. Access fees for using public facilities or equipment
  46. Credit monitoring fees for identity protection
  47. Roadside assistance fees for car insurance policies
  48. Destination fees for car purchases
  49. Vehicle preparation fees for car purchases or rentals
  50. Debit card usage fees for bank accounts.


  1. Fact Sheet: President Biden Highlights New Progress on His Competition Agenda
  2. Junk Fees (Consumer Financial Protection Bureau)
  3. Biden: Junk Fees "in Sight" for Travel (Yahoo! News)
  4. What Are Junk Fees and Why Does Biden Want to Ban Them? (Time magazine)
  5. The President's Initiative on Junk Fees and Related Pricing Practices (White House blog)
  6. White House, CFPB, and FTC Continue Down Path to Eliminate Junk Fees (Brownstein Hyatt Farber Schreck)
  7. Junk Fees: The $11.7 Billion Everyone is Ignoring (CBS News)
  8. Unfair or Deceptive Fees; Trade Regulation Rule; Commission Matter No. R207011 (Federal Register)
  9. Hotel-Resort Junk Fees Dispute (The Wall Street Journal)