April 25, 2016

NAFCU talks payday rule, overdraft at CFPB

NAFCU President and CEO Dan Berger, Executive Vice President of Government Affairs and General Counsel Carrie Hunt and Director of Regulatory Affairs Alexander Monterrubio on Monday met with CFPB Director Richard Cordray to discuss the bureau's exemption authority, its upcoming payday lending rule, and its continued study of overdraft.

NAFCU has urged CFPB to more effectively use its exemption authority under Section 1022(b)(3)(A) of the Dodd-Frank Act to exempt credit unions from the bureau's rulemakings. In particular, NAFCU is seeking an exemption that would protect credit unions that make short-term, small-dollar loans in accordance with current state and federal laws, such as the payday alternative loan (PAL) program.

The discussion also included the bureau's plans for an overdraft rule. NAFCU has been in constant contact with the bureau about its planned actions related to overdraft. The association has raised concerns about an overdraft rule, noting the loss of such programs could lead credit union members to seek out more expensive alternatives.