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Beige Book: Economic Growth                            CFPB to ‘Reconsider’ Small-

          Continues Through End of Year                          Dollar Lending Rule

          Economic  expansion  continued                         The CFPB has said it would
          across all 12 Federal Reserve districts                begin a rulemaking under which
          at a modest to moderate pace from                      the CFPB “may reconsider” its
          late-November through the end of                       rule regarding short-term, small-
          2017, the Federal Reserve reported                     dollar loans. Jan. 16, 2018, was
          in its first Beige Book release of                     the rule’s effective date, although
          2018. Consumer spending across                         most provisions do not require
          the holiday retail season was higher                   compliance until Aug. 19, 2019.
          than expected. Manufacturing expanded  at a  “modest” pace,   Finalized in October 2017, the rule imposes an ability-to-pay test
          as did wages. Some districts reported they expect further wage   on a wide swath of small-dollar loans of 45 days or less, including
          increases in the next reporting period as well.
                                                                 payday loans, auto title loans, deposit advances and longer-term
          Employment growth continued at a modest pace, with most   loans with balloon payments. The rule also includes provisions
          districts characterizing their wage growth as modest to moderate.   limiting attempts to withdraw payment from borrowers’
          Labor market tightness continued in most districts, with many   accounts,  but  includes  an  exception  for  banks  that hold  the
          noting difficulty filling skilled labor openings. Home sales and   borrower’s account and attempt to withdraw payment without
          construction across most districts saw continued sluggishness   assessing an NSF or overdraft fee.
          due in part to low inventory, and commercial real estate grew   The bureau exempted entirely small-dollar loans from lenders
          on par with previous the previous reporting period, which was   that made fewer than 2,500 of these loans in each of the current
                                                                 and previous years and for which these loans account for less
          To read more visit:    than 10 percent of revenues, a provision that protects banks’
          monetarypolicy/files/BeigeBook_20180117.pdf            flexibility to make small-dollar “accommodation loans” for their

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