Last week, the eOriginal team traveled to Scottsdale, Ariz., for the 33rd Independents Conference and Exposition, hosted by the American Financial Services Association. The theme of the event, Champions for the Future, was extremely appropriate, as much of the dialogue focused on the regulatory landscape and compliance, and its impact on the vehicle finance industry moving forward, especially an announcement from the Consumer Finance Protection Bureau (CFPB) regarding small-dollar lending.
CFPB Oversight Expanding
As noted in the Wall Street Journal, “Traditional installment lending and vehicle-title loans have been around for years, but the emergence of new variations and technologies that allow companies to offer loans more widely has spurred the CFPB to consider expanding its oversight to marketplace lenders, said sources familiar to the matter.” This article was right on the money.
The Conversation at AFSA
Coinciding with the conference, the CFPB announced a field hearing on small-dollar lending scheduled for June 2 in Kansas City and also released a study, Single-Payment Vehicle Title Lending. In reference to the research results, CFPB Director, Richard Cordray, noted in a press release, “Our study delivers clear evidence of the dangers auto title loans pose for consumers. Instead of repaying their loan with a single payment when it is due, most borrowers wind up mired in debt for most of the year.”
In response to the CFPB, the conference host stated in a news brief, “AFSA has been in constant dialogue with the CFPB regarding the content, tone and tenor of the proposed small dollar rule since the bureau released its outline for the proposal in March of 2015. AFSA will continue to vigorously advocate for its members in the traditional installment loan industry for fair treatment by the CFPB and other federal and state regulators.”
The conversations at AFSA 2016 echoed the increasing need for transparency and compliance when it comes to vehicle financing. For years, we have been hard at work at eOriginal preaching the importance of using technology to enhance transparency and confidence, including providing access to vital third-parties, be it custodians, investors or regulators, such as the CFPB, through detailed read-only audit trails that provide confidence into the state of an asset.
Want to learn more about our digital transaction solution? Join us on June 21st for a complimentary webinar, Beyond Paper: The Benefits of Taking the Vehicle Loan Process Digital.