California

The California Department of Financial Protection and Innovation (DFPI) should restore cost limits for earned wage advances and other fintech cash advances under proposed regulations rather than allow a temporary registration regime with no cost limits for up to four years, the Center for Responsible Lending, Consumer Federation of California, National Consumer Law Center, and Office of Kat Taylor said in comments filed with the Department on November 27. The groups “strongly support the provisions [of the proposed regulations] that make clear that income-based advances are loans and that...

Payday lenders charge exorbitant fees to borrowers without assessing their ability to repay, and the annual interest rates on these loans are in the triple digits.

The undersigned organizations commend the Department of Financial Protection and Innovation (DFPI) for moving to regulate abusive fintech lenders, including earned wage advance providers. We are very pleased to support the proposed rules and encourage the DFPI to vigorously enforce them to ensure that California’s most vulnerable consumers are not harmed. Signatories California Employment Lawyers Association (CELA) CA Labor Federation CA League of United Latin American Citizens (CA LULAC) California Low-Income Consumer Coalition (CLICC) California Reinvestment Coalition (CRC) Center for...

Nearly 500,000 people are currently detained pretrial in jails around the United States, in part due to high bail amounts set by the judicial system that individuals cannot afford. That is a six-fold increase in the U. S. pretrial population from the 1970s, when it was closer to 83,000 people detained. Bail is money required in exchange for release from jail while one awaits trial. With bail costs rising, it has been difficult for individuals and their loved ones to afford paying a court directly for the full bail amount. Instead, they have increasingly turned to for-profit bail bond companies...

This set of comments will focus on earned wage access programs and other newer types of payday advance programs. NCLC and CRL have also joined a broader set of comments submitted by the California Economic Justice Coalition on a broader range of issues and a second set in conjunction with the Student Borrower Protection Center on income share agreements. These comments will focus in particular on these questions that DFPI poses: For what industries should DFPI first establish registration requirements under Financial Code section 90009(a)? What are the consumer protection risks posed by those...

On September 25, 2020, Governor Newsom signed AB 1864 (Chapter 157, Statutes of 2020), establishing the California Consumer Financial Protection Law (“CCFPL”) under Division 24 of the Financial Code. The undersigned consumer advocates are encouraged to see that the Department of Financial Protection and Innovation (“DFPI” or the “Department”) is seeking input from stakeholders in developing regulations to implement the CCFPL. We write this comment in response to the following questions regarding registration requirements that the DFPI posed in 3(a)-(b): For what industries should the DFPI...

Our broad coalition of consumer and business organizations thanks you for the opportunity to comment regarding how the DFPI can best implement AB 1864 (Limón), the California Consumer Financial Protection Law (CCFPL). The CCFPL is an important and significant step forward for California and offers the promise of a bold consumer-facing department that can be at the forefront of consumer protection. We look forward to partnering with you and your team to help make that promise a reality. We must first acknowledge that the on-going COVID-19 pandemic has exacerbated disparities for low and...