Consumer, Small Business, and Other Groups Oppose OCC Federal Charter

In December, a group of nearly 50 consumer, civil rights, small business, and other community organizations wrote to express their opposition to an OCC nonbank lending charter.

Some highlights from their letter:

We are deeply skeptical of assurances that it will be possible to maintain the same range of consumer protections as exist in state law under a Federal charter regime. Fundamentally, the primary reason for a lender to seek a federal charter is to avoid state licensing regimes and their accompanying laws and oversight.


Should federal regulation be seen by lenders as more stringent than state regulation, presumably lenders would no longer seek a charter. For this reason, we doubt that it is possible to create a functioning federal charter system that did not result in significant pre-emption of state consumer protection laws.

We therefore strongly oppose any new federal lending charter that would enable companies to avoid state interest rate caps, other consumer and small business protections, or state oversight. We very much appreciate your attention to our concerns, and look forward to continuing to discuss these issues with you.