Guide highlights payment issues under payday lending rule – but not mandatory underwriting provision (which is out for comment)

A guide highlighting the payment-related requirements of the federal consumer financial protection agency’s “Payday Lending Rule” was released Wednesday, with a key disclaimer that the guide does not discuss the rule’s mandatory underwriting provisions – which the bureau is currently seeking to change in a proposed rule.

The Consumer Financial Protection Bureau (CFPB) said its “small entity compliance guide” highlights information “that may be helpful when implementing the payment-related requirements of the Payday Lending Rule,” which the agency issued in October 2017.

However, just this month, the bureau proposed a change to the rule (which goes fully into effect in August), which “reconsiders” (or rescinds) the portion of the rule requiring the mandatory underwriting provisions of the rule. The agency said, in releasing the guide Wednesday, that it “does not discuss the (existing) Rule’s mandatory underwriting provisions.”

The proposal to rescind the mandatory underwriting provisions is out for comment until May 15. In the meantime, the bureau is also proposing to delay the Aug. 19, compliance date for the mandatory underwriting by 15 months to Nov. 19, 2020. Comments are due on that by March 18.

The guide also pointedly notes that it is “not a substitute for reviewing the Payday Lending Rule.”

“The Payday Lending Rule and its Official Interpretations (also known as the commentary) are the definitive sources of information regarding the Payday Lending Rule’s requirements,” the guide states.

CFPB said the guide also includes has examples intended to illustrate some portions of the payday lending rule. However, the agency warned, the examples do not include all possible factual situations that could “illustrate a particular provision, trigger a particular obligation, or satisfy a particular requirement.”

Small Entity Compliance Guide: Payday Lending Rule