CFPB Director Presents Report Raising Concerns about Big Tech and Interest Rates

In testimony before both the Senate Banking Committee and the House Financial Services Committee, CFPB Director Rohit Chopra described areas for concern raised in the agency's "Spring 2022 Semi-Annual Report."

In his testimony, Mr. Chopra said that the CFPB is preparing for a transition into the "digital era" which involves confronting the increasing involvement of big tech firms in banking. He stated that the influence of big tech firms on the banking industry may have a negative impact on competition and user choice. He warned that big tech firms' entry into banking not only poses consumer protection risks, but also limits the ability of smaller firms to compete. He said that the CFPB is proactively working to examine the effects of large technology conglomerates entering payments and financial services, as well as creating conditions for small firms and start-ups to challenge incumbents.

Mr. Chopra also raised concerns about the impact of interest rates on credit cards. He said that the rise in interest rates coupled with inflation are resulting in rising household debt (specifically auto loan debt and credit card debt).

Mr. Chopra urged Congress to take steps to (i) preserve the neutrality and nondiscrimination of nonbank payment platforms, (ii) increase personal financial data rights to prevent overreach from big tech firms and (iii) protect consumer privacy and autonomy.