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Congress Fails to Repeal Rule Through Congressional Review Act
On May 17th, the opportunity for Congress to use the Congressional Review Act (CRA) process to repeal the CFPB’s small-dollar lending rule expired. Consumers’ Research has raised concerns that the CFPB’s rule will harm the very consumers the bureau is charged with protecting.
Beau Brunson, Consumers’ Research’s Senior Policy Advisor, released the following statement on the resolution:
“Consumers’ Research is disappointed that Congress failed to use its authority under the CRA to repeal the CFPB’s small-dollar lending rule. As finalized, the small-dollar rule will decrease access to credit for America’s most financially vulnerable populations. Acting-Director Mulvaney committed to reexamining the bureaus final rule when he was appointed last year, but Congress’s refusal to act has reignited urgency for the Bureau to review the rule. If the CFPB fails to act on this matter consumers will bear the burden of the rule’s unintended consequences.”
In its final rule, the CFPB acknowledged the impact the regulation will have on the industry and on consumers. It estimated a decrease in payday loan volumes of 62 to 68 percent with a corresponding loss of revenue. This will undeniably restrict consumer access to credit. The CFPB stated that the decrease in storefronts “may limit some physical access to credit for consumers, and this limit may be felt more acutely by consumers in rural areas.”
Washington, D.C., May 17– Founded in 1929, Consumers’ Research is the nation’s oldest consumer organization that seeks to increase the knowledge and understanding of issues, policies, products, and services of concern to consumers. For more information, visit: https://consumersresearch.org/ and follow Consumers’ Research on Twitter at @ConsumersFirst.