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The California Department of Financial Protection and Innovation (DFPI) has issued proposed amendments to its regulations implementing the Pilot Program for Increased Access to Responsible Small Dollar Loans (Pilot Program).  Initially effective from 2014 to2018, the Pilot Program’s sunset date was extended to January 1, 2028.  The Pilot Program operates under the California Financing Law (CFL) and is administered by the DFPI.… Continue Reading

As part of its Making Ends Meet survey, the CFPB issued a report last week on how consumers use payday, auto title, and pawn loans (“alternative financial services” or “AFS”) and the other sources of credit available to them. Consumers surveyed include only those with a traditional credit record and the sampling focused on consumers with lower credit scores, recent credit delinquencies, or living in rural areas.… Continue Reading

In last week’s election, Nebraska voters passed Initiative 428, a ballot measure that places a 36 percent APR cap on payday loans. The question presented to voters was:

Shall Nebraska statutes be amended to: (1) reduce the amount that delayed deposit services licensees, also known as payday lenders, can charge to a maximum annual percentage rate of thirty-six percent; (2) prohibit payday lenders from evading this rate cap; and (3) deem void and uncollectable any delayed deposit transaction made in violation of this rate cap?… Continue Reading

Hours after the CFPB released its final payday/auto title/high-rate installment loan rule on October 5, 2017, the OCC rescinded its guidance on deposit advance products.  That guidance, entitled Supervisory Concerns and Expectations Regarding Deposit Advance Products published in November 2013 (OCC Bulletin 2013-40), and substantially identical guidance issued by the FDIC on the same day, had effectively precluded banks subject to OCC and FDIC supervision from offering deposit advance products. … Continue Reading

The House Appropriations Committee has approved by a vote of 30-17 the FY17 Financial Services and General Government Appropriations bill.  The Committee also adopted a bipartisan amendment to the bill that would block the CFPB from finalizing or enforcing a rule regulating payday lending until the CFPB submits a detailed report on the consumer impact to Congress and identifies existing credit products available to replace the current sources of short-term, small dollar credit. … Continue Reading

The leaders of four liberal and minority Congressional caucuses have written to Director Cordray to urge the CFPB to adopt “strong protections” for payday loans.  The letter was signed by the co-chairs of the Congressional Progressive Caucus and the chairs of the Congressional Hispanic Caucus, Congressional Black Caucus, and Congressional Asian Pacific American Caucus.… Continue Reading

The CFPB has issued an order denying the petition filed by CheckSmart Financial Company in September 2013 to modify or set aside a civil investigative demand (CID) it received from the CFPB. 

As we previously reported, the petition stated that the CID was issued in connection with a nonpublic investigation launched by the CFPB “to determine whether payday lenders, check cashers, their affiliates, or other unnamed persons have been or are engaging in unlawful acts or practices in connection with the origination of payday loans and the cashing of payday loan proceeds” in violation of the Consumer Financial Protection Act (CFPA).  … Continue Reading

Six banking industry trade groups, including the American Bankers Association, the Consumer Bankers Association and the Financial Services Roundtable, have sent a comment letter responding to a Department of Defense (DOD) advanced notice of proposed rulemaking (ANPR) on changes to the coverage of the DOD’s Military Loan Act (MLA) regulations.  The MLA, as implemented by the DOD regulations, imposes a 36% rate cap on “consumer credit,” which as currently defined, only includes tax refund loans and certain closed-end payday and auto title loans made to active duty armed forces members and their dependents, and prohibits certain terms in such loans. … Continue Reading

David Silberman, the CFPB’s Associate Director of Research, Markets and Regulations, made the CFPB’s April 2013 white paper on payday and deposit advance loans the focus of his testimony at the hearing held on July 24 by the Senate’s Special Committee on Aging entitled “Payday Loans: Short-term Solution or Long-term Problem?”  … Continue Reading