CUs concerned with CFPB position on fees, data collection
The Consumer Financial Protection Bureau (CFPB) has missed opportunities to recalibrate its regulatory approach to fulfill its consumer protection mission without impeding access to credit, CUNA wrote to the Senate Banking, Housing, and Urban Affairs Committee Thursday.
CFPB Director Rohit Chopra testified before the committee, and CUNA submitted a similar letter Wednesday in advance of his testimony before the House Financial Services Committee.
“Credit unions’ commitment to member service is a key reason why credit union members are among the most financially healthy in America and agree that their credit union cares about them,” the letter reads, citing numerous data points from CUNA’s 2022 National Voter Poll showing credit union members are more likely to believe their financial institution has positively impacted their financial well-being.
“This sentiment reflects exactly the type of relationship banking that Director Rohit Chopra has stated he wanted to become commonplace in the consumer financial services markets,” the letter adds.
CUNA notes credit unions are concerned with:
- The CFPB’s Request for Information fees, particularly the bureau’s blanket condemnation of all fees.
- The potential for unintended consequences associated with the CFPB’s proposed small business data collection.
- That unregulated providers are increasingly engaged in financial activities without being subject to the robust consumer protection laws and regulations in place for financial institutions.
- Potential legislative or regulatory actions intended to modify certain types of debt from the credit reporting system, which CUNA believes will do long-term damage to lending and access to credit for borrowers.
- Any proposed “all-in” national interest rate cap, as the Federal Credit Union Act contains a usury cap, and credit unions often design small-dollar loans to mitigate harm caused by other, high-cost lenders.
- Potential legislation that would expand the scope of the Fair Debt Collection Practices Act to cover business loans.
CUNA also noted its principles that should guide any CFPB action, including using its authority to exempt credit unions from certain rulemakings, a transparent rulemaking process, and engagement with NCUA and other stakeholders.