Payday Loan Rules Proposed by Consumer Protection Agency

CFPB proposes new rules to regulate payday lending, short-term loans that often carry triple digit interest rates.

News Story (NATIONAL)

Jessica Silver-Greenberg, Michael D. Shear
New York Times (NYT)
March 26, 2015
Link to story

Tags: Consumer Protection

Organizations mentioned/involved: Consumer Financial Protection Bureau (CFPB)


The Consumer Financial Protection Bureau, the agency created at President Obama’s urging in the aftermath of the financial crisis, took its most aggressive step yet on behalf of consumers on Thursday, proposing regulations to rein in short-term payday loans that often have interest rates of 400 percent or more.

The rules would cover a wide section of the $46 billion payday loan market that serves the working poor, many of whom have no savings and little access to traditional bank loans. The regulations would not ban high-interest, short-term loans, which are often used to cover basic expenses, but would require lenders to make sure that borrowers have the means to repay them.