SE Nebraska News

U.S. Representative Mike Flood (R-NE-01) and U.S. Senator Pete Ricketts (R-NE) have introduced a Congressional Review Act resolution aimed at overturning a recent rule implemented by the Consumer Financial Protection Bureau (CFPB). This rule, titled “Defining Larger Participants of a Market for General-Use Digital Consumer Payment Applications,” was enacted on January 9, 2025, and seeks to broaden CFPB's regulatory oversight within the digital consumer payment market.

According to Representative Flood, "Over the last four years, progressive activists sought to dramatically expand the regulatory authority of the Consumer Financial Protection Bureau." He argues that the rule in question has been used to extend CFPB's examination authority over non-bank consumer payment firms. Flood emphasizes the importance of reversing this rule to prevent the CFPB from becoming "a barrier to innovation for job creators across America."

Senator Ricketts similarly criticized the rule, stating, "Following their election loss, the Biden-Harris CFPB rushed an eleventh-hour rule to attack non-bank digital consumer payment applications." He believes that the regulation unnecessarily expands CFPB's authority and calls on his congressional colleagues to consider the resolution promptly.

Carl Holshouser, Executive Vice President of TechNet, commented, "Technology helps Americans of all backgrounds manage their financial lives. The CFPB’s rule doesn’t benefit consumers or the market, but it would stifle fintech innovation." He commended the introduction of the resolution and anticipates a congressional move to overturn the rule.

Penny Lee, President and CEO of the Financial Technology Association, described the CFPB’s action as an overreach, stating that the final rule "was deeply flawed, failed to define a market or identify specific risks to consumers." She praised Flood and Ricketts for initiating the Congressional Review Act process.

The rule was part of several late-year regulations finalized by the CFPB on November 21, 2024. It extends the Bureau's supervisory authority over nonbank entities classified as "larger participants"—those handling at least 50 million consumer payment transactions annually. This includes entities such as payment apps and digital wallets.

Critics highlight that while many payment companies are subject to federal and state regulation, the CFPB's new rule identifies no significant consumer harm warranting further oversight. With payment service complaints comprising just 1% of the Bureau's 1.3 million complaints in 2023, some argue that additional regulation may unnecessarily complicate consumer payment options.