Reps. Foster, Bustos question CU impact of CFPB payday rule

November 4, 2016

Illinois Reps. Bill Foster (D) and Cheri Bustos (D) wrote to the Consumer Financial Protection Bureau (CFPB) Thursday urging the bureau to consider how its proposal will impact credit unions. In their letter, the 2 legislators highlighted the proposal’s negative impact on NCUA’s Payday Alternative Loan (PAL) program.

“Credit unions exist for the benefit of their members and already have a primary, prudential state of federal regulator,” Foster and Bustos wrote. “Indeed, the CFPB recognized that in providing a conditional exemption for the NCUA PAL program, but the rule appears to establish duplicative or conflicting new requirements to all loans, including those offered through this program.

“We urge you to harmonize the standards in the rule, including record retention requirements for NCUA-supervised credit unions,” they added.

CUNA agrees with the members of Congress that the CFPB proposal will impact a number of credit union-friendly products, and wrote to the bureau Friday outlining additional concerns.