b'Payday + Small Dollar LendingIn 2020, Goodwin monitored 17 publicly announcedwas to delay implementation of the rule until November federal and state enforcement actions concerning2020. In July, however, the CFPB issued a final rule payday, installment, or small dollar lending. 2020 levelsrescinding certain key provisions of the Payday Lending were slightly up from recent enforcement activity inRule on the grounds that the Bureau had re-evaluat[ed] the sector, as Goodwin reported on 13 actions in boththe legal and evidentiary bases for these provisions 2018 and 2019, but represents a continued declineand [found] them to be insufficient. from earlier years, such as the 26 actions monitoredThe CFPB also issued guidance related to new in 2017. In another year of relatively consistentproducts emerging in the marketplace in response levels of enforcement, regulators primarily targetedto the increasing demands for short-term liquidity, the usual alleged practices: predatory lending orundoubtedly due in part to the COVID-19 pandemic. collection practices, illegal or usurious interest rates,This year, the CFPB issued an advisory opinion clarifying and misleading or deceptive advertisements. Severalthe circumstances under which earned wage access notable regulatory developments occurred during 2020products, which offer payday advances to consumers as well, including the CFPBs decision to rescind keyfor earned but as-yet unpaid wages, are subject to underwriting provisions of the Payday Lending Rule andRegulation Z. The CFPB also implemented a framework the OCCs promulgation of its True Lender Rule.for traditional deposit banks and others to seek ano-action letter (NAL) on small loans ($100-500) offered Key Trends by such institutions to consumers for a low flat fee. Though we predicted last year that the CFPBs proposedFinally, OCC promulgated a rule clarifying when a bank changes to the Payday Lending Rule signaled a morehas exercised its lending authority such that it is the relaxed enforcement environment in the near term, inTrue Lender. This rule potentially simplifies the legal 2020 the CFPB continued to take the lead on initiatinglandscape for bank partnerships, although whether the payday lending enforcement actions. The CFPB broughtrule survives legal challenge and whether courts will seven of the 17 publicly announced actions across theadopt the OCCs interpretation remains to be seen. year (including one action in coordination with South Carolina and Arkansas state agencies), compared with2020 Highlightsonly one action initiated by the FTC. State regulators were also an active enforcement presence, initiatingCFPB Rescinds Mandatory Underwriting Provisions nine actions. Although there was only a slight uptick inof the Payday Lending Rulethe total number of enforcement actions, enforcementEarlier this year the CFPB announced several agencies reversed a four-year decline in total recoveries,amendments to key provisions of the Payday Lending securing approximately $49.7 million in consumerRule. The Rule, originally promulgated in 2017, relief and civil money penalties compared to less thanestablished new requirements for lenders offering $18million in 2019.short term lending products such as payday loans, 2020 was perhaps most notable for developments invehicle title loans, and certain installment loans. The payday lending regulation. The CFPBs Payday Lendingoriginal rule addressed two distinct issues, including Rule, promulgated in 2017 under then-Director Cordray,the underwriting of covered loans (the Mandatory imposed new underwriting and payment requirementsUnderwriting Provisions) and also limitations on a for covered loans. One of the first actions of Directorlenders ability to collect payments (the Payment Kraninger upon taking the helm in December of 2018Provisions), such as through withdrawing payments 36'