In seeking to extend its jurisdiction over “nonbank” auto lenders — including captive finance companies and independent finance companies — the Consumer Financial Protection Bureau is reaching for lenders that are too small, the American Financial Services Association said Monday.
“The threshold the CFPB proposes for larger participants in the automobile finance market is too low,” AFSA, a lenders trade group in Washington that includes many auto lenders, said in a statement sent directly to the CFPB during a public-comment period on the proposed change in the bureau’s rules.
For smaller players, greater regulation by the CFPB would drive up the cost of compliance disproportionately, and that could drive some smaller lenders out of auto finance, the association said. In addition, more regulation would likely raise the retail cost of credit and restrict consumer access to credit, the group said.