U.S. Bank’s Simple Loan Product Fills Consumer Need

September 11, 2018
Nick Simpson

U.S. Bank’s Simple Loan Product Fills Consumer Need

Small-Dollar Lending Helps Customers During Financial Emergencies

 

WASHINGTON – The Consumer Bankers Association said U.S. Bank’s Simple Loan product, launched today, fills a critical consumer need. The program is designed to help customers faced with emergency financial needs through a clear, regulated, more affordable short-term loan. A bulletin issued by the Office of the Comptroller of the Currency in May encouraged banks to serve consumers in the small-dollar installment loan market who, because of earlier regulatory guidance, were forced to rely on costly, less regulated payday loans or pawn shops during financial emergencies.

 

“U.S. Bank’s goal is to fulfill a customer need. This program – and others like it offered by retail banks – are essential for consumers faced with financial emergencies,” said CBA President and CEO Richard Hunt. “I am appreciative regulators are recognizing the need for short-term, small-dollar credit and the necessary roles banks can play in this space – instead of forcing American families to rely on costly, less regulated lenders.”

 

The Federal Reserve found that nearly half of Americans do not have the necessary savings on hand to cover a $400 emergency expense. The bulletin issued by the OCC and the Bureau of Consumer Financial Protection’s reexamination of a previous rule were critical steps in banks reentering this important consumer space.

 

NOTE: CBA President and CEO Richard Hunt wrote an op-ed discussing the need for small-dollar loans. That op-ed is here.

 

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About the Consumer Bankers Association

The Consumer Bankers Association represents America’s leading retail banks. We promote policies to create a stronger industry and economy. Established in 1919, CBA’s corporate member institutions account for 1.7 million jobs in America, extend roughly $4 trillion in consumer loans and provide $275 billion in small business loans annually. Follow us on Twitter @consumerbankers.