Small-dollar lending

Some in the industry worry the Fed may balk at allowing OCC charter recipients into the payments system, but Otting downplayed those concerns.

Gov. Jerry Brown’s administration sent letters Wednesday to 20 nonbank lenders that charge triple-digit annual percentage rates to try to determine if their use of online referrals is steering borrowers into larger loans than they want or need.

The nation's fifth-largest bank on Monday rolled out a three-month consumer loan that is far less expensive than the typical payday loan. The move comes as regulators are encouraging banks to reach out to the subprime market, which they largely abandoned.

The Office of the Comptroller of the Currency’s bulletin is seen as just one piece of the regulatory puzzle to coax banks into installment lending.

Just two months ago, Comptroller Joseph Otting seemed to signal that the OCC might be open to letting national banks rent their charters to payday lenders. Now he is clarifying that it won’t happen.

The legislation, signed Monday by Gov. Rick Scott, authorizes 60- to 90-day loans of up to $1,000. It makes Florida the first state to pass a law designed to blunt the impact of the CFPB’s payday lending rule.

Comptroller of the Currency Joseph Otting said reform of Community Reinvestment Act regulations is a "key element" of how regulators aim to recalibrate rules a decade after the financial crisis.