As CUNA continues its advocacy efforts on the Consumer Financial Protection Bureau’s (CFPB) short-term, small-dollar lending rule, it seeks feedback from credit unions on how they will be affected by the proposed rule. Feedback is due to CUNA by Aug. 31, and comments are due to the CFPB by Sept. 14.
The proposal includes new rules for payday, title, and high-cost installment loans including increased underwriting standards. CUNA is concerned that the rule sweeps in a number of consumer-friendly credit union small-dollar and other covered loans, and adds unnecessary compliance burdens and costs to these loans. The proposed rule also adds additional burdens to certain products offered to provide members better options and choices like auto refinance loans.
CUNA has released its early analysis of the rule, highlighting a number of concerns about the proposed rule and its effects on access to credit.
CUNA sent a letter to NCUA Chair Rick Metsger Monday, asking him to work closely with the CFPB to ensure that the agency is fully aware of the proposed rule's impact on existing credit union products.
CUNA, with the Independent Community Bankers of America, also sent a preliminary letter to CFPB Director Richard Cordray Monday, urging him to focus on the impact the rule will have on depository institution small-dollar lending programs.
In conjunction with its proposed rule, the CFPB issued a request for information about predatory lending practices, specifically about other potentially high-risk loan products and practices not covered by the proposal.
Comments on this request for information can be sent to CUNA by Sept. 30, and must be sent to the CFPB by Oct. 14.