The Treasury Department issued a comprehensive report on Tuesday that provides policy recommendations relating to nonbank financial institutions, fintech, and innovation. There are a few issues raised in the report that AFSA believes will be of particular interest because these they have been discussed at recent meetings. Specifically, the Treasury Department recommends:
- Changes to the TCPA, including the compilation of a reassigned numbers database with a safe harbor and clear guidance on reasonable methods for consumers to revoke consent;
- That state regulators build a more unified licensing regime and supervisory process;
- That the Bureau of Consumer Financial Protection (BCFP) establish minimum effective federal standards for third-party debt collectors that address the information that is transferred with a debt for purposes of debt collection or in a sale of the debt (and not write rules for first-party debt collectors without additional direction from Congress);
- That the Bureau promulgate regulations under the FDCPA to codify that reasonable digital communications, especially when they reflect a consumer’s preferred method, are appropriate for use in debt collection;
- That banks increase small-dollar lending;
- That the BCFP rescind its small-dollar rule;
- That Congress enact a federal data security and breach notification law to protect consumer financial data and notify consumers of a breach in a timely manner.
Sections of Treasury’s report reflect the efforts of AFSA members and staff in emphasizing the benefits of traditional installment lending in communities across the United States. For example:
- “Nonbank financial firms play important roles in providing financial services to U.S. consumers and businesses by providing credit to the economy across a wide range of retail and commercial asset classes.”
- “The demand for short-term, small-dollar products is high because many households struggle with income volatility, thin or no credit files or a subprime score, or lack of access to mainstream financial products that meet their needs. According to the Fed, 40% of Americans say they could not easily cover an emergency expense of $400.”
