WASHINGTON—NAFCU is asking Congress to encourage the CFPB to exempt credit unions from its rulemakings.
In advance of the House Financial Services Subcommittee on Financial Institutions and Consumer Credit hearing Thursday on concerns about CFPB limiting access to credit and overriding “state and tribal sovereignty,” NAFCU sent a letter to the committee’s leaders asking lawmakers to press the CFPB to use its Dodd-Frank Act authority to exempt credit unions from its rulemakings, including an upcoming payday loan rule.
In a letter from NAFCU Vice President of Legislative Affairs Brad Thaler, NAFCU raised concerns that payday lending rulemaking could prevent responsible payday alternative loans from credit unions.
"We have urged the CFPB to carefully craft any future rulemaking to ensure credit unions are not forced to withdraw from providing a viable alternative to predatory lenders,” wrote Thaler. “Additionally, NAFCU recommended that any future payday rulemaking promulgated by the CFPB include an express exemption for federal credit unions and other insured depository institutions conducting short-term, small-amount loans in accordance with current state or federal laws, such as the National Credit Union Administration’s Payday Alternative Loan program, which was carefully crafted to protect borrowers by offering them a fair and cost-effective alternative to predatory payday loans."