The Consumer Federation of America released the following statement in response to the Consumer Financial Protection Bureau's announcement that it will not prioritize supervision or enforcement of the payday lending rule. 

“The CFPB has sided with bottom-feeder payday lenders at the expense of vulnerable borrowers struggling to make ends meet,” said Adam Rust, director of financial services for the Consumer Federation of America. “The CFPB is designed to be a law enforcement agency. A policy of ‘hear no evil, see no evil, punish no evil’ is a sure-fire way to promote lawless behavior.”

The CFPB issued a final rule on payday lending in October 2017. Before the rule could go into effect, the CFPB dropped one of its two key components. Under the leadership of then Trump-appointee Director Kathy Kraninger, it scuttled the underwriting provisions of the rule, but kept the payment provisions. The provisions required covered lenders to receive permission to debit a borrower’s account after two unsuccessful attempts. Under its Unfair Deceptive Abusive Acts or Practices authority, the CFPB’s rule prevented lenders from using bank overdrafts and non-sufficient funds fees to coerce repayment. 

The rule was scheduled to go into effect on March 30th, 2025. 

Pew research revealed that more than one in four payday loan customers experienced an overdraft fee due to a lender’s attempt to collect a payment from their bank account. The CFPB identified one lender that debited a borrower’s account 11 times in a single day.For more information, see CFA’s recent blog, “Preserve the Payday Lending Rule.”