Payday lending, Fed semiannual report this week in Congress

February 9, 2016

WASHINGTON (2/9/16)--A hearing on short-term, small dollar loans, as well as Federal Reserve Chair Janet Yellen’s two appearances before Congress top the list of what’s happening this week in Congress.

The House Financial Services subcommittee will conduct a hearing, titled “Short-term Small Dollar Lending: the CFPB’s Assault on Access to Credit and Trampling of State and Tribal Sovereignty.” It is scheduled for Thursday at 1 p.m. (ET).

The Credit Union National Association (CUNA) will likely submit a letter for the record of the hearing.

“It should be an interesting hearing, we’ve been carefully watching and engaging closely with the CFPB as it prepares to release a proposal on payday lending,” said Ryan Donovan, CUNA’s chief advocacy officer.

CUNA met with both the CFPB a number of times last year to share the credit union perspective on short-term, small dollar loans, otherwise known as payday loans, urging the CFPB to exempt the National Credit Union Administration’s Payday Alternative Loan (PAL) program in place without additional compliance burdens.

The PAL program places restrictions on the number of loans that can be taken out consecutively, as well as caps on interest rates.

Yellen will testify before the House Financial Services Committee Wednesday at 10 a.m. (ET), and before the Senate Banking Committee Thursday at 10 a.m. (ET). Both are part of her regular, semiannual appearances before the committees, and will be streamed on the committees' websites.

CUNA will also be monitoring a House Financial Services subcommittee on housing and insurance hearing scheduled for Thursday at 9:30 a.m. (ET), titled “The Future of Housing in America: Examining the Health of the Federal Housing Administration.”