On their way out the door, the Biden Administration issued a rule entitled “Defining Larger Participants of a Market for General-Use Digital Consumer Payment Applications,” expanding the supervisory power of the Consumer Financial Protection Bureau (CFPB) to oversee more entities without proper justification, which took effect on January 9. 

This burdensome rule allows the CFPB to regulate non-bank entities that complete 50 million digital consumer transactions per year, affecting those that provide fund transfer and digital wallet transactions through digital apps like Venmo and contactless payments, such as Apple Pay.

By taking a one-size-fits-all approach to these varied and unique payment products and services and lumping them into the same market, this Biden CFPB rule places significant compliance burdens on affected companies with no benefit whatsoever to American consumers or the market. 

There is no problem that this rule is solving – in fact, this rule will ultimately hurt consumers, as well as increase regulatory costs, and suppress innovation by creating a disincentive to provide new services.

House Republicans are bringing forward legislation to protect companies from the CFPB’s unnecessary supervisory overreach, get rid of burdensome red-tape, encourage innovation, and support small businesses and job creators.

S.J. Res. 28, introduced by Sen. Pete Ricketts, reverses the Biden Administration CFPB’s rule “Defining Larger Participants of a Market for General-Use Digital Consumer Payment Applications,” that would allow the CFPB more oversight power over non-bank entities that complete 50 million digital transactions a year, providing no benefit to consumers or the market and placing significant burdens on businesses that use digital payments.

Agencies can’t be allowed to invent problems so they can expand their power – this legislation stops the CFPB from doing just that. 
Safeguarding Overdraft Services for American Consumers

Last December, the Biden Administration’s Consumer Financial Protection Bureau (CFPB) issued yet another misguided final rule called “Overdraft Lending: Very Large Financial Institutions,” placing one-size-fits-all restrictions on overdraft fees for banks in a burdensome and costly move.

If this misguided rule takes effect, many banks and credit unions will be forced to stop offering overdraft services or limit them excessively, taking critical services away from millions of Americans across the country who rely on them for unexpected expenses between pay periods. Furthermore, many institutions losing overdraft fee income will likely cease to offer free checking accounts or require high minimum balances that families cannot meet. 

This rule will particularly burden smaller banks and credit unions that are already struggling with an avalanche of new regulations. Ultimately, rules like this one will lead to fewer community banks and fewer options for American consumers, reducing competition and resulting in more consolidation in banking. 

We cannot allow Americans to lose access to credit services they rely on. House Republicans are bringing forward legislation to overturn this Biden-era rule in order to protect these services for Americans, ensure stability in financial services, encourage competition, and safeguard our economy.

Sen. Tim Scott’s legislation, S.J. Res. 18, nullifies the Biden CFPB’s final rule “Overdraft Lending: Very Large Financial Institutions,” preventing the price cap limitations on overdraft fees from taking effect, ensuring overdraft services remain accessible for American consumers.

House Republicans will always fight to encourage fair competition and ensure Americans have access to the financial services they rely on.