Congress Halts CFPB Rule Defining 'Larger' Digital Payment Apps

This joint resolution steps in to block a specific rule finalized by the Consumer Financial Protection Bureau (CFPB). The rule in question, known formally as "Defining Larger Participants of a Market for General-Use Digital Consumer Payment Applications" (published in the Federal Register under 89 Fed. Reg. 99582), aimed to establish criteria for identifying major players in the digital payment app space for potential CFPB supervision.

Hitting 'Undo' on a Digital Wallet Rule

Think of the apps many of us use daily – services for sending money to friends, paying bills, or making online purchases. The CFPB created this rule to define which providers of these "general-use digital consumer payment applications" count as "larger participants." Being labeled a 'larger participant' typically means a company falls under the CFPB's supervisory authority, which can involve regular examinations and specific compliance requirements.

This joint resolution effectively hits the 'undo' button. By disapproving the rule, Congress prevents it from taking effect or having any legal force. It's a direct move using congressional authority to nullify a specific agency regulation.

What This Means on the Ground

The immediate effect is that the regulatory landscape for these payment apps remains as it was before this specific CFPB rule was finalized.

• For Payment App Companies: Businesses that might have met the CFPB's definition of a 'larger participant' under this rule will not face the specific supervisory oversight that this particular rule would have triggered. They avoid any new compliance hoops or examinations tied directly to this definition.
• For the CFPB: The agency's effort to define and supervise this segment of the market through this specific rule is stopped. It essentially blocks one avenue the CFPB was pursuing to oversee these larger digital payment providers.
• For Consumers: Any potential increase in consumer protection or standardized practices that might have resulted from the CFPB supervising these 'larger participants' under this specific rule will not materialize. The existing regulatory framework and protections remain in place, but the specific oversight envisioned by this nullified rule won't be added.