ALEXANDRIA, Va. – The Consumer Financial Protection Bureau’s (CFPB) short-term credit rule comment portal has received more than 172,000 public comments, setting a new record for CFPB rulemaking comment periods. Now publicly accessible in the Regulations.gov comment portal, the vast majority of comments appear to represent the concerns customers have over the negative effect this rule will have on their ability to access credit.
“We have known all along that customers value the option of having payday loans, but even we have been overwhelmed by the sheer volume of customers who have chosen to speak up to make their voices heard,” said Dennis Shaul, CEO of the Community Financial Services Association of America (CFSA). “This record-breaking number of comments highlights the grave concerns consumers have about the Bureau’s rule and the disastrous repercussions it will have on their ability to access to credit.”
In recent remarks, Director Cordray said: “For small-dollar loans, we have issued a rulemaking proposal that would cover payday loans, vehicle title loans, and certain installment loans. We are currently taking public input on the proposed rule, and already have received more than half a million comments, with many more expected before the comment period closes next month.”
So far, the CFPB has uploaded approximately 68,000 comments for public viewing on its comment portal website out of the at least 500,000 comments Director Cordray referenced. This means there is a backlog of at least 432,000 comments yet to be uploaded to the comment portal, which is only likely to grow as additional comments are submitted to the CFPB before the close of the comment period on October 7.
When it announced the rule in early June, the CFPB enthusiastically encouraged the general public to participate in the comment period process. The incredibly high level of public input represents the largest number of public comments ever submitted to the CFPB, which has proposed approximately 200 rules since its founding in 2011. In fact, the number of comments already in the CFPB comment portal in response to its payday loan rule is three times that of the second highest number of public comments submitted, which was 51,796 for the Arbitration Agreements rule proposal.
“It is imperative that the Bureau read every single one of these comments and consider them seriously as they deliberate on the rule,” Dennis Shaul said. “This is the first time the CFPB has truly heard the voice of the consumer during this rulemaking process. While these customers have been thus far ignored by the CFPB, they are speaking very loudly now in support of short-term credit options.”
When short-term credit customers have been asked their opinions on these loan products in the past, the results have shown they greatly value it and oppose regulating it further.
Through a FOIA request earlier this year, CFSA found that more than 98% of people who submitted testimonials to the CFPB’s ‘Tell Your Story’ portal had positive feedback about their experiences with the payday lending industry.
In addition, a recent survey of payday loan customers confirmed they have overwhelmingly positive attitudes of the product, with 97% of customers expressing their satisfaction with payday loans and 96% saying they would recommend the product to others. Furthermore, the survey found that 74% of customers are concerned about more restrictions on the industry by the government and 80% said current regulations are enough.
This is consistent with publicly available data from the CFPB, the Federal Trade Commission, and state regulators from across the country that show payday loan complaints submitted by consumers are extremely low and pale in comparison to other products like mortgages, credit cards, and student loans.
“Consumers place an extremely high value on their ability to access to short-term credit, which is clear in the tens of thousands of comments already published,” Shaul said. “The CFPB has never listened to or understood the short-term credit customer. This flood of customer comments supporting payday loans sends a clear message against this burdensome rule that should not be lost on the CFPB as it deliberates.”