The CFPB’s latest focus on consumer fees is targeting payment processors for school lunches. The CFPB says that families who choose to purchase school lunches are being forced to pay fees to companies that process their payments.

“These fees are widespread, regressive, and may be burdensome for families and districts, who have little control over fee rates and few opportunities to shop around,” the bureau said, in releasing a report on the payment processors.

CFPB Director Rohit Chopra said the lunch fees that families must pay is another example of so-called “junk fees” that harm consumers.

“Transaction fees and other types of junk fees can take an economic toll on American families just trying to pay for basic school expenses, including school lunch for kids,” he said. “Today’s report will help school districts avoid contracts with financial firms that harvest excessive fees from families who purchase school lunch.”

Based on an analysis of the 300 largest school districts, the CFPB said that families that pay full price for school meals and make two deposits into their account a month into their child’s lunch account would incur on average more than $42 in fees over the course of a school year.  That means that for every $1 spent, $0.08 goes to a processing company.

Consumers cannot choose their payment platforms since contracts are determined at the school-district level. The CFPB said that school districts participating in the federal National School Lunch Program are required to provide fee-free ways to pay for school lunch and inform families about all available payment methods. However, the bureau said that the fee-free options are not always well-publicized.

“Both school districts and processors frequently fail to post the availability of free payment methods, and further, free options may be more burdensome than electronic options,” the bureau reported.

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