According to this
article in the New York Times, the Consumer Financial Bureau is set to release its first set of rules
for payday lenders. Full details of the proposed rules have not yet been
released, but it appears that the Bureau will be directing some of the
rules at a fuller disclosure of interest rates and fees associated with
While the CFPB can't put a cap on the exorbitant interest rates that
payday lenders charge, it can declare some of their practices unfair,
deceptive, or abusive. Whether there will be a right for private enforcement
remains unclear, but is also unlikely.
According to the NYT and David Silberman of the CFPB, the agency's
reasearch has revealed that what is supposed to be a short-term loan can
turn into a "long-term and expensive debt trap."
As soon as the new rules are released for comment, we will update the blog
to discuss them.