Jeff Sovern and I come at most issues from different sides of the street but I want to credit him for the open mind he showed in his recent blog post on deposit advance loans. Unlike many of his colleagues in the consumer advocacy business (to say nothing of the staff at the FDIC and OCC), Jeff is not prepared to eliminate deposit advance loans before someone gives serious consideration to “what would the borrowers who are now taking out such loans do if they could no longer get them.” … Continue Reading
The CFPB’s white paper on payday and deposit advance loans received well-deserved criticism in a letter to Director Cordray from the Community Financial Services Association of America (CFSA), a national trade organization for payday lenders.
The CFSA’s letter characterizes the paper’s data as “demonstrably incomplete and misleading” and indicates that the paper’s “tone, conclusions, and specific language [seem] aligned with the type of rhetoric that more often comes from advocacy groups that are not always driven by facts, but rather are driven by agendas and unsupported, anecdotal information.” … Continue Reading
Last Thursday, the Office of the Comptroller of the Currency and Federal Deposit Insurance Corporation proposed guidance on deposit advance loans. The Federal Reserve Board declined to join the OCC and FDIC and instead provided a general warning that such loans need to be thoughtfully structured and lawfully provided. Comments on the OCC and FDIC proposals must be submitted no later than 30 days after their publication in the Federal Register.… Continue Reading