Affordable Small-Dollar Loan Products Final Guidelines
FIL-50-2007 June 19, 2007
The Federal Deposit Insurance Corporation (FDIC) has issued the attached "Affordable Small-Dollar Loan Guidelines" that encourage financial institutions to offer small-dollar credit products and to promote these products to their customers. The products should be affordable, yet safe and sound, and consistent with all applicable federal and state laws.
Small-dollar loans are in strong demand. The goal of a small-dollar loan program is to enable insured institutions to better serve an underserved and potentially profitable market, while helping consumers avoid, or transition away from, reliance on high-cost debt.
The guidelines encourage insured institutions to offer small-dollar loan products that have affordable, reasonable interest rates with no or low fees and payments that reduce the principal balance of the loan.
As part of their programs, institutions may consider offering financial education and a savings component in order for borrowers to reduce their reliance on high-cost, short-term credit.
During a Community Reinvestment Act (CRA) examination, FDIC examiners may favorably consider small-dollar loan programs when evaluating the lending performance of small, intermediate-small, and large institutions. A small-dollar loan program may be viewed as uniquely responsive in helping to meet the credit needs of a community.
FDIC-Supervised Banks (Commercial and Savings)
Robert Mooney, Acting Deputy Director, Compliance & Consumer Protection, at (202) 898-3911 or
RMooney@fdic.gov; April Breslaw, Acting Associate
Director, Compliance Policy & Examination Support Branch,
at (202) 898-6609 or APBreslaw@fdic.gov; Mira Marshall,
Acting Chief, CRA/Fair Lending Section, at (202) 898-3912
or MMarshall@fdic.gov; or Carol Rosa, Policy Analyst, at
(202) 898-8515 or CRosa@fdic.gov