CFPB

The Consumer Financial Protection Bureau says the proposal would increase access to credit, but consumer groups argue that it will encourage lenders to make high-cost loans while protecting them from legal liability.

A proposal to expand consumer protections in the state was added to a budget bill after being dropped in June. Financial institutions say the measure conflicts with federal law and are working behind the scenes to stop it.

The agency sought feedback on potential changes to the Equal Credit Opportunity Act. But a coalition of industry and advocacy groups want a longer comment period to afford “a greater opportunity for thoughtful public participation.”

Banks, data aggregators and fintechs have clashed for a decade over how consumers’ bank account data should be shared with third parties. The agency says it will offer a plan, and industry officials have plenty of suggestions already.

Members of the Senate Banking Committee took the agency’s leader to task for eliminating underwriting requirements for small-dollar lenders, which lawmakers said has left consumers more vulnerable during the pandemic.