WASHINGTON—America’s Credit Unions is expressing its support for the final update by the CFPB for its rule updating the Equal Credit Opportunity Act (ECOA) and its implementing regulation, Regulation B.
The trade group said the proposed rule is identical to that it had proposed earlier, saying it “balances fair lending with consumer protection.”
According to America’s Credit Unions, when the rule takes effect July 21, it will:
- Remove disparate-impact (effects-test) language from Regulation B, as this will reduce uncertainty and avoid chilling innovative, inclusive credit programs
- Narrow the discouragement provision to “oral or written statements”
- Clarify that discouragement covers only statements directed at applicants or prospective applicants
- Clarify that the notion that encouraging one group does not, by itself, constitute discouragement of non-recipients
- Revise the discouragement knowledge standard so that a violation occurs only when a creditor knows a statement would communicate discriminatory outcomes.
The final rule can be found here.
