Five agencies responsible for banking policy and regulation issued a joint statement Thursday calling on financial institutions to offer responsible small-dollar loans to both consumers and small businesses to help them get through the coronavirus crisis and pledged to offer guidance in the future on how best to do so.
The agencies— The Federal Reserve, Consumer Financial Protection Bureau (CFPB), Federal Deposit Insurance Corp. (FDIC), Office of the Comptroller of the Currency (OCC) and National Credit Union Administration (NCUA)—said they recognize “the important role that responsibly offered small-dollar loans can play in helping customers meet their needs for credit due to temporary cash-flow imbalances, unexpected expenses, or income short-falls during periods of economic stress or disaster recoveries.”
“Federally supervised financial institutions are well-suited to meet the credit needs of customers affected by the current COVID-19 emergency,” they said in the statement. “The current regulatory framework allows financial institutions to make responsible small-dollar loans. Such loans can be offered through a variety of loan structures….”