Did payday loan regulations did trump roll back?
Executive summary
Yes — the Trump administration dismantled or delayed multiple federal consumer protections for payday and small-dollar lending: the Consumer Financial Protection Bureau under Trump rolled back an Obama-era ability-to-repay rule and delayed or abandoned other payday safeguards [1] [2] [3], and the Office of the Comptroller of the Currency finalized a “true lender” / “rent‑a‑bank” rule in late 2020 that would have let nonbank lenders evade state interest‑rate caps [4] [5]. Congress later used the Congressional Review Act to overturn the OCC rule in 2021 [5] [6].
1. What the Trump administration actually changed
Beginning in 2019, the CFPB under the Trump administration moved to abandon an Obama‑era payday rule that required lenders to assess borrowers’ ability to repay high‑cost short‑term loans—effectively rolling back a protection designed to prevent debt‑trap lending [1] [3]. Separately, the OCC issued a 2020 rule that redefined what counts as a “bank loan,” enabling nonbank payday and small‑dollar lenders to partner with national banks to originate loans and thereby skirt state rate caps (the so‑called “rent‑a‑bank” or “true lender” scheme) [4] [5].
2. How those changes would affect borrowers in practice
The ability‑to‑repay rollback removed a requirement that lenders verify income and major monthly obligations before making small high‑cost loans—an omission consumer advocates warned would make it easier for vulnerable people to take on loans they cannot repay [1] [2]. The OCC’s change was a legal tweak in regulatory language: by treating loans made in a bank’s name as bank loans, nonbank lenders could charge interest rates that state laws would otherwise cap, producing annual rates in some cases far above state limits (examples cited include loans as high as 149% or 299% APR) [4] [5].
3. Timeline and congressional response
The CFPB actions began in 2019 with delays and rollbacks of the 2017 rules [1] [3], the OCC finalized its “National Banks and Federal Savings Associations as Lenders” rule in late 2020 [4], and in mid‑2021 Congress voted to overturn the OCC rule under the Congressional Review Act; President Biden signed that resolution into law, nullifying the rent‑a‑bank regulatory change [5] [6] [7]. Human Rights Watch and other advocates framed Congress’s repeal as closing the loophole the OCC had opened [4].
4. Who objected and why — states, advocates, industry
A coalition of state attorneys general and consumer advocates led sustained opposition to the rollbacks, arguing the proposed and finalized changes violated state consumer protections and would exacerbate predatory lending in low‑income communities [8] [4]. Payday‑industry leaders and some Republican lawmakers defended deregulation as “regulatory relief” and argued the rules were legally shaky or harmful to credit markets [3] [9]. Both sides accused the other of advancing political and financial interests.
5. Allegations of influence and motive
Reporting documented lobbying ties and large campaign donations from payday‑industry executives to Trump allies, and critics claimed those ties helped secure regulatory changes without new supporting research; former CFPB staffers alleged data manipulation and lack of justification for rollbacks [2]. Industry framed the changes as removing overreach and protecting lending access, while consumer groups framed them as favoring corporate profits over borrower safety [2] [3].
6. Bottom line and limits of the record
The factual record in major reporting shows the Trump administration both rolled back the CFPB’s ability‑to‑repay protections and finalized an OCC rule that would let lenders evade state rate caps, and Congress later repealed the OCC rule in 2021 [1] [2] [4] [5]. Reporting documents industry influence and vigorous state and advocacy pushback, but sources differ on legal rationales and on how much actual consumer harm resulted before the repeal; available sources document the policy moves and reactions but do not settle long‑term effects on borrower outcomes [2] [4].