In The News

‘True Lender’ Rule That Lets Fintechs Charge High Rates Up For Review

Protocol

21 Jun 2021

Crystal Kaldjob spoke to Protocol about members of Congress and consumer advocates pushing for rollback of a Trump-era “True Lender” rule that supporters say has made consumer lending more competitive and critics say is just a new avenue for predatory lending.

Last year, online lenders Avant and Marlette settled with Colorado’s attorney general in a suit that alleged they charged interest rates above the state’s 36% cap. If the True Lender rule change passes, online lenders would not be able to use the OCC [Office of the Comptroller of the Currency] rule as a defense, potentially making it harder to offer these loans.

“The real consequence of not having a bright-line test is you are subject to a patchwork of judicial decisions,” Crystal said, adding that she believes the Colorado settlement could become a model for how the issue is regulated in states.

Read the full article.

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