New leadership at the Consumer Financial Protection Bureau (CFPB), including the likely nomination of Rohit Chopra as director, is fueling industry speculation around possible changes to the credit system, credit bureaus, and high-interest lending.

Why should we care?
Just as subprime lending fueled the Great Recession more than a decade ago, these types of products are back under the regulator’s microscope. The new nominee to lead the CFPB, Rohit Chopra, has critiqued what he sees as predatory lending. He is expected to keep a close eye on installment loans, or short-term loans that typically have high APRs that are sometimes used by credit-challenged consumers. Companies under this umbrella include World Acceptance, Curo, and Enova. Meanwhile, the bedrock of the credit system – the credit bureaus – could face a major revamp, if ideas from Biden’s campaign literature are implemented. According to his campaign proposal, the new administration would create a public credit reporting agency under the CFPB, rivaling or perhaps even replacing Experian, TransUnion, and Equifax. The rationale for such a move would be to reduce the number of “credit invisible” consumers and address the discriminatory impacts of traditional credit-scoring practices. Critics, including the Consumer Data Industry Association, suggest such a solution would be unworkable. “A government-owned credit bureau would create a volatile and unstable lending environment, riddled with inconsistent policies, swing back and forth from election to election, leaving consumers with higher prices and limited options for credit,” it said in a statement.