Last week, the Community Financial Services Association (CFSA) – a national organization of consumer lenders, including Advance America – and the U.S. Hispanic Chamber of Commerce hosted a research and policy event in Washington, DC to discuss the Consumer Financial Protection Bureau’s (CFPB) recent rulemaking proposal for short-term lending and its potential impact on small businesses and consumers.
The event, titled “Consumer Credit Under Assault: Does the Data Support the Rhetoric?,” attracted more than 150 opinion and thought leaders, policymakers and regulators, as well as financial services groups and media. CFSA CEO Dennis Shaul, U.S. Congressman David Schweikert (R-Ariz.), Columbia Law School professor Ronald Mann and Kennesaw State University professor Jennifer Priestley were among the presenters.
The event featured two discussions – the first of which included researchers and academics whose studies disputed conclusions drawn by the CFPB in its rulemaking proposal for short-term lending. The second discussed the impact the CFPB’s proposal would have on businesses and consumers; how the agency had failed to consider actual customer welfare outcomes when drafting the proposal; and how the rules may conflict with state laws already regulating the cash advance industry.
In his remarks, Shaul shared the perspective of consumers across the country who use short-term credit to manage periodic financial difficulty. “Our customers come to us because they are making a choice. And often—as is suggested by a lot of research, including our own Harris Poll – they come because a cash advance is the best and most thought-out short-term credit choice that they have.”
The CFPB is currently conducting a Small Business Review process through which the proposals are being discussed and evaluated by their potential impact on small businesses. Later this year, the CFPB is expected to release a more detailed draft rule, which will be open for public comment and review before it is finalized.
You may view video of the event on YouTube.