Insights on CFPB’s Spring 2023 Unified Agenda

CBA Insights on CFPB’s Spring 2023 Unified Agenda

What Happened: The CFPB released its Spring 2023 Unified Agenda as part of the Unified Agenda of Federal Regulatory and Deregulatory Actions. The Bureau reasonably anticipates having the regulatory matters identified below under consideration during the period from July 1, 2023, to June 30, 2024. The CFPB’s Agenda is divided into three sections: pre-rule stage, proposed rule stage, and final rule stage.

Note: The Bureau will have these items under “consideration” during the next six-month period, and items listed in the pre-rule stage (e.g., Overdraft Fees, FCRA Rulemaking, NSF Fees) should not be expected to be finalized by Spring 2024. In some cases, these items may not progress at all.

What To Watch For: There are five significant developments in the Spring 2023 Agenda:

The Bureau has added proposed rule activity regarding supervision of larger participants in consumer payments markets. This is new to the agenda and is in proposed rule status. The CFPB has defined larger participants in several markets and is considering issuing additional regulations to define the scope of the CFPB’s nonbank supervision program in markets for consumer payments (e.g., Venmo, CashApp, etc.). CBA generally supports supervision of nonbank entities to ensure a level playing field.

The Bureau is engaged in pre-rule activity regarding non-sufficient funds (NSF) fees but does not specify what that activity may be. The Bureau, in the description of the pre-rule stage, notes that “[u]ntil recently, NSF fees were a significant source of fee revenue from deposit accounts for depository institutions; lately some financial institutions have voluntarily stopped charging such fees.” Based on this language, CBA anticipates that this activity is likely to curtail or otherwise significantly limit the ability of depository institutions to charge NSF fees. As with overdraft, the Bureau’s last agenda included NSF as a pre-rule item. It continues to be in pre-rule status on the current agenda and, as such, indicates that the Bureau may push and possible rulemaking further into the next year.

The Bureau has listed that a rule on credit card penalty late fees is in the final rule stage. The final rule is expected to advance the Bureau’s Notice of Proposed Rulemaking (NPRM) regarding credit card late fees and late payments. While the agenda lists an anticipated date of October 2023, industry should expect to see a final rule on credit card late fees, which is likely to include a proposed modification of the credit card late fee safe harbor, by late summer or early fall.

The Bureau is engaged in pre-rule activity on overdraft fees, and is considering proposing amendments to Regulation Z with respect to the special rules for determining whether overdraft fees are “finance charges” under Regulation Z. If overdraft fees are considered “finance charges,” they would then be included in APR calculations and subject to the disclosure requirements under Regulation Z. The Bureau’s last agenda included overdraft as a pre-rule item. It continues to be in pre-rule status on the current agenda and, as such, indicates that the Bureau may push and possible rulemaking further into the next year.

The Bureau is engaged in pre-rule activity regarding the Fair Credit Reporting Act (FCRA) and its implementing regulations, Regulation V. However, the Bureau provides no further clarity on what specific rulemaking with respect to FCRA it is exploring and any proposed rule may slip into 2024. Though not discussed in the Unified Agenda, through inter-trade discussions, CBA has learned that the Bureau has begun outreach to potential SERs in developing a SBREFA panel for the FCRA rule.

What’s Missing & Why It Matters: Continuing the trend from the Fall 2022 Agenda, the Bureau has not listed in the agenda any “long-term actions,” which are items under development but for which the CFPB does not expect to have a regulatory action within the 12 months after publication of the Unified Agenda. As a result, the Spring 2023 Agenda provides insight into the CFPB’s activities only for the next 12 months.