SACRAMENTO – California Attorney General Xavier Becerra issued the following statement denouncing the Consumer Financial Protection Bureau’s (CFPB) rollback of the Payday Lending Rule that protects consumers from the worst harms associated with short-term payday lending:
“It is senseless for the CFPB to scrap a rule that prevents harms associated with predatory lending,” said Attorney General Becerra. “This rule was intended to protect Americans from abusive and unfair practices by greedy payday and auto title lenders. These lenders take advantage of the most vulnerable – hardworking families, seniors, and people with disabilities. The CFPB should do everything in its power to keep people from getting caught in a rigged debt cycle, not pander to threats from the very lenders it is meant to regulate.”
In 2017 alone, according to California’s Department of Business Oversight, borrowers in the state paid more than $436 million in fees, with over 70 percent of this amount coming from hardworking people who took out seven or more loans. In addition, 52 percent of payday loan customers in 2017 had average annual incomes of $30,000 or less.