CFPB Fall Supervisory Highlights Shed Light on Agency Priorities – Small Dollar LendingThe Fall Supervisory Highlights came out this month and reports the Bureau’s findings of examinations completed between January 2021 and June 2021. The CFPB publishes the Supervisory Highlights to help institutions better understand how the CFPB examines and monitors compliance with federal consumer financial laws. CFPB examiners often find problems during supervisory examinations that are

CFPB Sets Sight On “Buy Now Pay Later” in Targeted InquiriesOn December 16, the CFPB announced that it had issued orders to five companies providing “Buy Now Pay Later” (BNPL) products to “collect information on the risks and benefits of these fast-growing loans.” Earlier this year, the CFPB released a blog directed at consumers explaining how BNPL products operate and identifying potential risks associated with

CFPB Fall Supervisory Highlights Shed Light on Agency PrioritiesYesterday, the Consumer Financial Protection Bureau (CFPB) released its Fall Supervisory Highlights. The report covers examinations completed between January and June of 2021. Over the last year, the Biden-era CFPB has made various statements about its priorities. For instance, the Bureau has issued comments or taken action related to the small dollar lending agenda,

After (Another) Unusual Year, We’re Very Thankful and Wish You a Happy ThanksgivingNow that the pandemic’s “social distancing” is lessening, we hope you are all able to gather with friends and family this Thanksgiving. As we do the same, we wanted to count our blessings as we review the year. This year, we are thankful for being able to return to our offices, our favorite restaurants, and

CFPB Action Against Student Loan Originator Sends Message to Income Share Agreement IndustryOn September 7, 2021, the CFPB issued a consent order against Better Future Forward, Inc., and related entities (collectively, BFF), companies that provide financing for postsecondary education to students via income share agreements (ISAs). In this enforcement action, the CFPB found that BFF falsely represented that ISAs do not create debt and are not loans

District Court Ruling Clears Way for Small Dollar Rule Compliance Date in June 2022Yesterday, in Community Financial Services Association of America, Ltd. v. Consumer Financial Protection Bureau, a lawsuit involving implementation of the payment provisions of the Payday, Vehicle Title, and Certain High-Cost Installment Loans Regulation (the “Small Dollar Rule”), the district court ruled on the Consumer Financial Protection Bureau’s (CFPB) and the Community Financial Services Association’s

The CFPB at 10 Years: A Look Back and a Look AheadOver the years, we have followed actions of the Consumer Financial Protection Bureau (CFPB) and published information that can be found on our Financial Services Perspectives blog. Now that the 10-year anniversary of the CFPB opening its doors has passed, let’s take a look back at where it started and where it may be

Illinois Caps Consumer Loans at 36% Rate, Limiting Consumers’ Access to CreditLast week, Illinois enacted the “Predatory Loan Prevention Act” (SB 1792), which would place a 36% rate cap on nearly all non-bank consumer loans. This act will essentially outlaw small-dollar loans in Illinois and may make ancillary products on auto loans, such as GAP insurance, unavailable for a large number of consumers. The act

The Consumer Financial Protection Bureau Issues Statement Regarding Small Dollar Lending and Signals Return to Prior PolicyOn March 23, 2021, the CFPB issued a brief statement highlighting its position regarding “consumer harms in the small dollar lending market” and likely future action to reverse the previous CFPB administration’s policy regarding the industry. The next day, the CFPB provided its Consumer Response Annual Report for 2020 to Congress, which stated the complaint

Florida Court Affirms That Merchant Cash Advance Product Not Subject to Usury StatuteThis month, a Florida appellate court held that a merchant cash advance (MCA) purchase and sale agreement was not a “disguised loan” and, therefore, was not subject to Florida’s criminal usury statute. MCA purchase and sale agreements, which offer merchants a fast and efficient way to obtain funding for their operations, are not loans. Rather,