Otting now runs an OCC that is significantly more receptive to banks being active in small-dollar lending. Before he was sworn in, the agency rescinded a 2013 guidance
that had effectively banned banks from offering deposit advance products. More recently, the OCC ended its 2002 regulatory order against the payday lender Ace Cash Express, allowing the Texas company to partner with national banks.
The recent moves are a marked change from the agency’s views on payday lending over a decade ago. In 2003, then-Comptroller of the Currency John D. Hawke Jr. told payday lenders, “Stay the hell away from national banks.” Otting has sung a different tune
, saying that banks should become active in small-dollar lending once again.
“We forced banks out of that small-ticket and consumer lending” business, where some rules required “full underwriting for a $500 loan that just don’t make sense,” he said at an industry conference
on April 9. “We really want more banks back in that space, because you will do it at a fairer, cheaper and with better rates issued than anybody else.”