FOR IMMEDIATE RELEASE
Contact: Vicki Christner – CUNA Communications; 202-329-9950; firstname.lastname@example.org
Washington, DC (October 5, 2016) – The Consumer Financial Protection Bureau (CFPB) proposed rule on short-term, small-dollar loans could rob consumers of safe and affordable alternatives to the predatory lenders in the market, the Credit Union National Association (CUNA) has written to the bureau in its comment letter on the proposal. CUNA’s full letter can be read here.
In a 61 page letter to the CFPB, with an attached 21 legal support letter from the Dentons US LLP, CUNA urges the bureau to withdraw its proposal or exempt credit unions as a class due to the many consumer dangers in the proposed rule. In lieu of that, CUNA asks the bureau to consider addressing the substantial shortcomings of the proposed rule with several recommendations outlined in its letter, and asks the CFPB to publish a revised proposal for public comment.
“The rule is overbroad and misses the mark of enhancing consumer protections because it fails to consider consumers’ needs, particularly those of modest means with financial challenges, and does not provide a clear and concise path to allow credit unions to meet these needs,” said Jim Nussle, president/CEO of CUNA. “The rule would have a detrimental impact on credit union programs that are widely recognized as being consumer-friendly, even by the CFPB itself. This does not achieve greater protection for members, but instead will limit their options and could force them to turn to much worse options.”
The CUNA/League system has met repeatedly with the CFPB on this issue because of their concern over a credit union member’s ability to have safe and affordable credit options.
CUNA’s letter details several problems with the proposed rule, including:
CUNA is advocating the CFPB should withdraw the rule; or provide a blanket exemption for credit unions (including PAL loans). Absent the foregoing, the bureau should make significant changes to the rule and re-propose it for public comment.
With its network of affiliated state credit union leagues, Credit Union National Association (CUNA) serves America's credit unions, which are owned by more than 100 million consumer members. Credit unions are not-for-profit cooperatives providing affordable financial services to people from all walks of life. For more information about CUNA, visit www.cuna.org or follow @CUNA on Twitter. For more information about credit unions, visit www.aSmarterChoice.org and follow @asmarterchoice on Twitter.