Federal regulators urged banks to begin offering small-dollar loans to customers facing financial hardships from the new coronavirus outbreak.
Banks are encouraged to offer open-ended lines of credit, closed-end installment loans, or “appropriately sized” single-payment loans, five regulators said in a two-page guidance document released Thursday.
Most banks have not been offering small-dollar loans in part because of past statements from regulators warning about some products.
“Previous guidance issued by regulators years ago cut off banks’ ability to offer customers short-term liquidity,” said Richard Hunt, the president and chief executive of the Consumer Bankers Association.
The new guidance—from the Federal ...
Learn more about Bloomberg Law or Log In to keep reading:
Learn About Bloomberg Law
AI-powered legal analytics, workflow tools and premium legal & business news.
Already a subscriber?
Log in to keep reading or access research tools.