To the dismay of many consumer advocates, it has been reported that Democratic National Committee Chairwoman and Florida Congresswoman Deborah Wasserman Schultz is supporting a bill (H.R. 4018) that would limit the authority of the CFPB to regulate payday loans.
The bill, entitled the “Consumer Protection and Choice Act,” would provide that if the CFPB finds that a state has a “deferred presentment transaction” law that satisfies certain requirements set forth in the bill, any CFPB rules regulating deferred presentment transactions or payday loans would not apply in that state. The requirements, which include limits on the amount of interest and fees that can be charged, the minimum and maximum loan term, maximum loan amount and a 24-hour rescission right, are intended to reflect the requirements of Florida’s deferred presentment transaction law.
The bill would take effect 24 months after enactment and would prohibit the CFPB from regulating deferred payment transactions or payday loans during that period.