Kraninger asserts three new bureau policies will foster innovation, ease uncertainty

Three policies announced Tuesday are intended to improve how the federal consumer financial protection agency exercises its authority to facilitate innovation and reduce regulatory uncertainty, the director of the agency told an Atlanta audience.

In remarks while opening a new Consumer Financial Protection Bureau (CFPB) regional office (the fourth located outside of D.C.), Director Kathleen Kraninger said the policies reflect the bureau’s additional mission of facilitating innovation and access to financial products and services for consumers.

On Tuesday, the CFPB announced three policies aimed at fostering innovation: a Compliance Assistance Sandbox (or CAS policy), aimed at enabling testing of a financial product or service where there is regulatory uncertainty; a revised trial disclosure program (TDP policy), in which entities seeking to improve consumer disclosures may conduct in-market testing of alternative disclosures for a limited time upon permission by the bureau; and, a revised no-action letter (NAL) policy that, the bureau said, provides, a more streamlined review process focusing on the consumer benefits and risks of the product or service in question.

An NAL under the new policy — the first — was also released Tuesday for the housing counselor agencies working with the House and Urban Development (HUD) Department that participate in the agency’s housing counseling program.

“These are the policies we are implementing to foster innovation,” Kraninger asserted. “As we apply these three policies, we will be looking at both the benefits of the innovation and also at whether they pose harm to consumers. This is fundamental to my priority for the prevention of harm to consumers.”

Kraninger said addressing innovation and regulatory uncertainty is more than high-tech products and smartphone apps, andding “it has the potential for broader application and greater beneficial impact.”

Director Kraninger’s Speech at Innovation Policies Launch Event