COMMUNITY GROUPS DECRY CFPB DELAY ON PAYDAY LENDING REFORM

FOR IMMEDIATE RELEASE: January 20, 2016
CONTACT: Jacob Swenson-Lengyel, jacob@npa-us.org, 312.316.3973

COMMUNITY GROUPS DECRY CFPB DELAY ON PAYDAY LENDING REFORM

In conjunction with the launch of a new website last week -- FamiliesCantWait.org -- community groups in Iowa, Nevada, Idaho, Michigan, Illinois, Missouri and Kansas called on Congressional leaders and the CFPB to act now

Chicago, IL -- Community groups are out in force this week in the winter weather with a simple message for Congressional leaders and the Consumer Financial Protection Bureau: “Don’t leave us out in the cold, our families can’t wait for payday lending reform!”

While the media has focused on financial industry attacks on the CFPB, there is growing criticism from National People’s Action and other groups who say that the CFPB is delaying the release of a rule that would protect consumers from dangers small dollar loans that trap more than 12 million Americans in an endless cycle of debt each year. Last week, the group launched a new website, FamiliesCantWait.org, that shows just how much the CFPB’s delay is costing American families.

The state actions in Iowa, Nevada, Idaho, Michigan Illinois, Missouri and Kansas are taking place at payday lending storefronts and Congressional offices, where the community groups hope to bring attention to the fact that each day the CFPB delays, families lose another $23,951,459. That adds up to $8,742,282,594 each year from families who live in states where these small dollar, high interest loans are allowed and doesn’t include online or installment lending.

All told, since the CFPB announced the rulemaking process and released the Small Business Regulatory Enforcement Fairness Act panel “first look” at the rule in March 2015, payday and title lenders have stripped more than $7 billion from American families -- and counting.

“Congress gave the CFPB a clear cut mission to protect American consumers from unfair and deceptive financial products. Each day Director Cordray and the CFPB delay this rule, they are not only failing to fulfill their mission, they are failing American families,” said Liz Ryan Murray, Policy Director for National People’s Action. “Our families can’t wait, they need payday lending reform now.”

National People’s Action has called for a strong and broad small dollar lending rule that fulfills three basic criteria to protect American families. First, the rule should require basic underwriting practices on all loans to ensure American consumers can payback the loan when it is due. Second, the rule should put a stop to the constant loan rollovers that are endemic in the industry by limiting individual indebtedness to 90 days. Finally, the rule should prevent lenders from being able to take money directly from a consumer’s bank account or hold title to their car.

For more information, or to interview Liz Ryan Murray, please contact Jacob Swenson-Lengyel at jacob@npa-us.org or 312.316.3973.

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National People's Action is a network of 29 grassroots organizations in 18 states working together to advance a racial and economic justice agenda for a new economy and true democracy.