Bipartisan Coalition Hopes to Repeal Small Dollar Rule
A bipartisan group in the House introduced a resolution on December 1st to overturn the Consumer Financial Protection Bureau’s (CFPB) recently published Small Dollar rule through the Congressional Review Act (CRA). The bill’s sponsor is Rep. Dennis Ross (R-FL), with Reps. Alcee Hastings (D-FL), Tom Graves (R-GA), Henry Cueller (D-TX), Steve Stivers (R-OH) and Collin Peterson (D-MN) cosponsoring.
House Financial Services Committee Chairman Jeb Hensarling (R-TX) threw his support behind the resolution, saying, “Americans should be able to choose the checking account they want, the mortgage they want and the short-term loan they want and no unelected Washington bureaucrat should be able to take that away from them.”
This will be Congress’ second use of the CRA this year to challenge a rule promulgated by the CFPB. Earlier this fall, the Republican-led Congress successfully utilized the CRA to overturn the CFPB’s rule on mandatory arbitration clauses, albeit by the slimmest of margins.
The CFPB’s Small Dollar rule is not scheduled to go into effect for another year and a half, but it could decimate small dollar lending and harm the exercise of tribal sovereignty. Hoping to stem the cycles of debt, the CFPB’s Small Dollar rule includes 3 key components – a full payment test, a principal payoff option, and a debit attempt cutoff.