FOR IMMEDIATE RELEASE
February 6, 2019
Aaron Weaver | firstname.lastname@example.org | 770-220-1610
DECATUR, Ga. — Responding to the Consumer Financial Protection Bureau’s announcement today that it plans to remove borrower safeguards intended to ensure that vulnerable consumers have the ability to repay short-term, high-interest “payday” loans, Stephen K. Reeves, associate coordinator of partnerships and advocacy for the Cooperative Baptist Fellowship, released the following statement:
“The decision by CFPB Director Kathy Kraninger to effectively gut the small-dollar lending rule is deeply disappointing. By doing so, the bureau charged with protecting consumers is instead choosing to side with multi-billion-dollar corporations over families struggling to make ends meet. After years of research, multiple rule drafts and time spent reviewing over a million public comments, to rescind this key provision of the rule before any impact can be determined is premature and an astounding waste of time and resources. Borrowers caught in loans designed to be debt traps have already waited far too long for the CFPB to fulfill its promise.
“If a lender will not assess a borrower’s ability to repay before extending a loan, that product is not a loan, it’s a trap. The bureau’s own research shows that 75 percent of all fees earned by payday lenders come from folks stuck in 11 or more loans a year. By removing the ability to repay provisions, the CFPB sides with those eager to profit off of 400-percent APR loans given to our most financially vulnerable neighbors.
CBF Advocacy will continue to condemn usury and call for a return to moral lending laws. Our churches and field personnel will continue to offer direct aid to those in need. We will engage the public comment period and lift up the voices of those who have come to our churches and ministries seeking help.
The faith community has already expressed our concerns directly to Director Kraninger. We trust that she will consider the voices of borrowers and of those to whom they turn for help. We pray that her heart will be moved and that she will allow the original rule to take effect.”
Reeves led a delegation Jan. 22 of national faith leaders to meet with the newly confirmed Director of the CFPB, Kathy Kraninger, and several senior officials. The diverse delegation, which included representatives of the Southern Baptist Convention’s Ethics & Religious Liberty Commission, U.S. Conference on Catholic Bishops and the Religious Action Center of Reformed Judaism, emphasized to Director Kraninger the importance of the ability-to-repay provision of the Bureau’s rule.
“Assessing a borrower’s ability to repay, a standard procedure for most loans, is the best way to prevent a loan from becoming a debt-trap,” Reeves said on Jan. 22. “The small-dollar lending rule is our best hope for preventing debt-trap lending. We’re here today to ask that it not be rescinded, weakened or reconsidered.”
In September 2018, CBF requested to join litigation to defend the Bureau’s regulation intended to restrict industry practices that create debt traps for consumers. Continuing its five-year effort alongside pastors, churches and Global Missions field personnel to reform predatory lending practices, CBF sought “intervenor” status in a case filed by two industry associations challenging the Bureau’s rule, which was set to be implemented by August 19, 2019. Learn more about this effort and read a FAQ at www.cbf.net/paydaylitigation.
Learn more about the efforts of CBF Advocacy to combat predatory lending and find resources here.
The Cooperative Baptist Fellowship is a Christian network that helps people put their faith to practice through ministry efforts, global missions and a broad community of support. CBF’s mission is to serve Christians and churches as they discover and fulfill their God-given mission.