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It doesn't take much for regulators to kill a product. Last April, Consumer Financial Protection Bureau Director Richard Cordray compared banks' deposit-advance loans to payday loans. The Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. followed by issuing stricter guidelines. Since then every bank that offered the product has dropped it. Following is a timeline of the deposit-advance loan's demise.
Image: Bloomberg News
ABA Issues Warning
Shortly after the moves last April by the CFPB and other federal agencies involving deposit-advance loans, American Bankers Association counsel Nessa Feddis warns that the result would be "Either costs go up or the product gets eliminated."