By Alexander M. Smith

Last October, the Consumer Financial Protection Bureau issued a final rule requiring payday lenders, automotive title lenders, deposit advance lenders, and similar short-term loan issuers to determine up front whether borrowers would have the ability to repay certain short-term, small dollar loans without borrowing again.  (The CFPB press release summarizing this rule is available here.)  On January 16, however, the CFPB announced that it would initiate additional rulemaking so that it could “reconsider” this rule.   Although the CFPB’s announcement did not repeal the rule, Law360 notes that many observers believe that the protections in the CFPB’s final rule will be “rolled back or eliminated altogether” and that other federal regulators, such as the Comptroller of the Currency, are considering amending their rules to expand the availability of similar small-dollar loans.   We will continue to monitor and report on the fate of the CFPB’s payday lending rule.