WASHINGTON (Legal Newsline) – Indiana Attorney General Greg Zoeller testified before the U.S. House Subcommittee on Financial Institutions opposing a new rule proposition from the Consumer Financial Protection Bureau (CFPB).
The proposed rule would preempt state authority to regulate small loan lending as well as consumer access to credit. Zoeller believes it would create a framework at the national level that would undermine a historically state issue. Zoeller believes the top-down regulations could constrict small loan lending markets by reputable lenders, which could in turn force Indiana consumers to turn to less-reputable offerings.
“Like other states, Indiana has worked hard to strike this balance between access to credit and protections against predatory lenders,” Zoeller said in his testimony to the subcommittee. “The proposed federal regulations would throw this balance off and reduce access to short-term loans for the people in my state and others who need this type of financial assistance the most and who need it from reputable lenders.”
The CFPB’s proposed rule was introduced in March 2015. Zoeller sent letters to the CFPB along with many other states but to little benefit, the attorney general's office states.