CFPB to issue FAQs helping BNPL lenders comply with laws. Click over to PYMNTS for the details: https://hubs.ly/Q02MpXcw0
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Fintech | Payments | Consumer Financial Services | Legal | Regulatory Compliance | Former CFPB Attorney - Office of Regulations
Today, Consumer Financial Protection Bureau Director Chopra issued a blog post concerning the CFPB's recently issued Buy Now, Pay Later (BNPL) interpretive rule. According to the blog post, the CFPB plans to issue a set of Frequently Asked Questions in September “to help lenders make transitions,” and affirms that the CFPB will provide a no-action position with respect to any BNPL lender “while it is transitioning into compliance in a good faith and expeditious manner.” With respect to the no-action position, the CFPB "expect[s] that other federal and state regulators will follow the same path." There's no indication of how long this no-action position will last or why the CFPB "expects" other federal and state regulators to follow suit. https://lnkd.in/e9JzMPFG #cfpb #consumerfinance #consumerfinancialservices #regulatorycompliance #fintech #fintechs #financialinstitutions #financialservices #payments #bnpl
What Buy Now, Pay Later lenders are doing to be upfront with borrowers | Consumer Financial Protection Bureau
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CFPB issues follow-on information about BNPL products, promises to provide FAQs for providers and they do "not intend to seek penalties for violations of the rules addressed in the interpretive rule against any Buy Now, Pay Later lender while it is transitioning into compliance in a good faith and expeditious manner. We expect that other federal and state regulators will follow the same path." There's no indication of how long this "promise" not to seek penalties will last or why the CFPB "expects" other federal and state regulators to go along with it. https://lnkd.in/ex6bbtkf
What Buy Now, Pay Later lenders are doing to be upfront with borrowers | Consumer Financial Protection Bureau
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Although not on the CFPB’s formal semiannual rulemaking agenda, and nobody was anticipating it, the CFPB chose to classify its action as an “interpretive rule” and thereby avoid publishing it as a proposed rule for comment. So you might say, “What’s the rush?” The “rush” is that the CFPB wants the deadline for Congress to override the rule under the Congressional Review Act to expire during this Congress and not during the new session of Congress that expires next year. In another sense, it has taken several years for the CFPB to take any formal action with respect to BNPL even though the CFPB has published several reports about the industry. BNPL didn’t just suddenly become a credit/charge card subject to TILA requirements applicable to such issuers. Clearly, there has been years of debate among staff at the CFPB to figure out how to regulate BNPL. It is not clear whether classifying this rule as interpretive only will work if a lawsuit gets filed against the CFPB challenging the rule. I would be surprised if a lawsuit does not get filed. The rule becomes effective only 60 days after it is published in the Federal Register. That strikes me as woefully insufficient time for BNPL providers to make all the operational changes required by this new rule. Since most, if not all, of the CFPB work on this regulation was done after September, 2022, it is subject to challenge because the CFPB used funds drawn from the Federal Reserve System at a time when the System was losing money. See https://lnkd.in/eGfa27QJ
Currently digesting, but here is the CFPB interpretive rule stating that BNPL loans are subject to Subpart B of Regulation Z (which includes dispute rights, requirements relating to billing statements, and cost of credit disclosures). The CFPB requests comment even though it states that this interpretive rule is not subject to the APA. We will be issuing our thoughts on the interpretive rule shortly. https://lnkd.in/gFjkJGHg
Truth in Lending (Regulation Z); Use of Digital User Accounts to Access Buy Now, Pay Later Loans
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The Consumer Financial Protection Bureau's new interpretive rule on #BNPL is set to take effect in under 60 days. In this blog post, we take a look at the rule’s new requirements for BNPL providers as well as the approach we’ve taken at Peach to address them. In brief, the new rule requires BNPL lenders to issue periodic billing statements, investigate and resolve disputes, and credit refunds to users’ accounts. Read the full blog post for more detail: https://lnkd.in/g9YfRvae
How Peach addresses the CFPB’s latest BNPL rule | Peach
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Important regulatory changes are set for #BNPL originators. Below we describe how Peach is helping our customers be prepared.
The Consumer Financial Protection Bureau's new interpretive rule on #BNPL is set to take effect in under 60 days. In this blog post, we take a look at the rule’s new requirements for BNPL providers as well as the approach we’ve taken at Peach to address them. In brief, the new rule requires BNPL lenders to issue periodic billing statements, investigate and resolve disputes, and credit refunds to users’ accounts. Read the full blog post for more detail: https://lnkd.in/g9YfRvae
How Peach addresses the CFPB’s latest BNPL rule | Peach
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Important regulatory changes are set for #BNPL originators — and fast. Curious about what this might mean for you? Talk to us at Peach, we got you covered.
The Consumer Financial Protection Bureau's new interpretive rule on #BNPL is set to take effect in under 60 days. In this blog post, we take a look at the rule’s new requirements for BNPL providers as well as the approach we’ve taken at Peach to address them. In brief, the new rule requires BNPL lenders to issue periodic billing statements, investigate and resolve disputes, and credit refunds to users’ accounts. Read the full blog post for more detail: https://lnkd.in/g9YfRvae
How Peach addresses the CFPB’s latest BNPL rule | Peach
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Is the new CFPB interpretive rule for BNPL stressing you? Talk to us at Peach , we got you covered! Afraid of the migration process? We got you covered there as well!
The Consumer Financial Protection Bureau's new interpretive rule on #BNPL is set to take effect in under 60 days. In this blog post, we take a look at the rule’s new requirements for BNPL providers as well as the approach we’ve taken at Peach to address them. In brief, the new rule requires BNPL lenders to issue periodic billing statements, investigate and resolve disputes, and credit refunds to users’ accounts. Read the full blog post for more detail: https://lnkd.in/g9YfRvae
How Peach addresses the CFPB’s latest BNPL rule | Peach
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On the topic of BNPL, new legislation was introduced in NY. Here's an interesting requirement: "No licensee shall collect, evaluate, report, or maintain in the file on a borrower the credit worthiness, credit standing, or credit capacity of members of the borrower's social network for purposes of determining the credit worthiness of the borrower; the average credit worthiness, credit standing, or credit capacity of members of the borrower's social network; or any group score that is not the borrower's own credit worthiness, credit standing, or credit capacity." Given that most credit scores are based on comparisons of the likelihood of default as compared against a "group score," this requirements seems to prohibit using any credit report. Of course, the legislation also says: "Subject to regulations to be promulgated by the superintendent, a buy-now-pay-later lender shall, before providing or causing to be provided a buy-now-pay-later loan to a consumer, make, or cause to be made, a reasonable determination that such consumer has the ability to repay the buy-now-pay-later loan." https://lnkd.in/evF7EpiV
NY State Senate Bill 2023-S9689
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"If BNPL is going to be sold with only partial safe lending laws applying, the laws need to do more to ensure BNPL products are actually safer". Check out the CHOICE article ⬇ #BNPL #safelendinglaws #consumers #consumerrights #consumerprotection #costofliving #credit #debts #debtspiral
Proposed buy now, pay later reforms a partial solution | CHOICE
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Fintech | Payments | Consumer Financial Services | Legal | Regulatory Compliance | Former CFPB Attorney - Office of Regulations
Just in: The Consumer Financial Protection Bureau (CFPB) issued an interpretive rule that confirms that Buy Now, Pay Later (BNPL) lenders will typically be deemed credit card providers. Accordingly, BNPL lenders would be required to provide consumers some key legal protections and rights that apply to conventional credit cards, such as dispute and refund rights, billing statements, and disclosures that lay out fees and pricing structures. This is not a big surprise as the CFPB has long hinted that BNPL products should receive many of the same consumer protections applicable to credit cards. The interpretive rule is effective 60 days after publication in the Federal Register. Comments will be accepted until August 1, 2024. https://lnkd.in/e7_ZVfeA #cfpb #bnpl #regulations #regulatorycompliance #fintech #fintechs #financialservices #financialinstitutions #consumerfinance
Truth in Lending (Regulation Z); Use of Digital User Accounts to Access Buy Now, Pay Later Loans
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