Comptroller of the Currency Issues Bulletin on Small-Dollar Lending: Interagency Lending Principles for Offering Responsible Small-Dollar Loans

WASHINGTON, May 20 -- The U.S. Department of the Treasury's Office of the Comptroller of the Currency issued the following bulletin (No. 2020-54) on May 20:

To: Chief Executive Officers of All National Banks, Federal Savings Associations, and Federal Branches and Agencies; Department and Division Heads; All Examining Personnel; and Other Interested Parties

Summary

The Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the National Credit Union Administration (collectively, the agencies) today issued the "Interagency Lending Principles for Offering Responsible Small-Dollar Loans." The agencies recognize the important role that responsibly offered small-dollar loans can play in helping customers meet their ongoing needs for credit due to temporary cash-flow imbalances, unexpected expenses, or income shortfalls, including during periods of economic stress, national emergencies, or disaster recoveries. The agencies encourage financial institutions to offer responsible small-dollar loans to consumers and small businesses.

The interagency lending principles are being issued as a follow-up to the joint statement transmitted by OCC Bulletin 2020-25, "Small-Dollar Lending: Joint Statement Encouraging Responsible Small-Dollar Lending in Response to COVID-19," dated March 26, 2020.

Rescission

This bulletin rescinds OCC Bulletin 2018-14, "Installment Lending: Core Lending Principles for Short-Term, Small-Dollar Installment Lending," issued on May 23, 2018.

Note for Community Banks

The interagency lending principles apply to community banks./1

Highlights

The OCC encourages banks to

* Refer to the interagency lending principles when offering small-dollar loans.

* Discuss plans to offer small-dollar loans with their OCC portfolio manager, examiner-in-charge, or supervisory office before implementation, particularly if the offerings constitute substantial deviations from existing business plans./2

Further Information

Please contact Steven Jones, Acting Deputy Comptroller for Credit Risk, at (202) 649-6220, or Paul Reymann, Director for Consumer Compliance Policy, at (202) 649-5470.

Grovetta N. Gardineer

Senior Deputy Comptroller for Bank Supervision Policy

Footnotes:

1/ The term "banks" refers collectively to national banks, federal savings associations, and federal branches and agencies of foreign banking organizations.

2/ Refer to OCC Bulletin 2017-43, "New, Modified, or Expanded Bank Products and Services: Risk Management Principles."