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MCOA Should Be a Congressional Priority

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AFSA today sent a request to Capitol Hill encouraging the reintroduction of the “Modernizing Credit Opportunities Act” (MCOA), which has been introduced in previous sessions but not in the current 119th Congress. This legislation would establish uniform federal standards for true lender determinations, while preserving the interconnected framework of federal banking law and providing a level playing field for the dual banking system.

The “Modernizing Credit Opportunities Act” would address ambiguities in existing law and provide the comprehensive federal framework needed to restore uniform national standards for both true lender determinations and valid when made protections. After Congress’ passage of the repeal of the Office of the Comptroller of the Currency’s True Lender Rule in 2021, there is no federal framework to determine true lender status in arrangements between federally insured depository institutions and financial technology (fintech) companies.

The MCOA establishes that federally insured depository institutions are true lenders when they are the party to which debt is initially owed according to loan terms, regardless of subsequent assignments or third-party service relationships. The legislation would apply uniform standards across all federally insured institutions – national banks, state banks, and federal savings associations – ensuring competitive equality while clarifying that service provider geographic location does not affect institutional location determinations.

Congress should act swiftly to re-introduce and enact the MCOA. Doing so will establish uniform federal true lender standards across all federally insured institutions, preserve valid when made protections through clear origination standards, preempt conflicting state laws undermining federal banking authority and competitive equality, and provide legal certainty for beneficial bank-fintech partnerships. Federal true lender legislation is essential for maintaining stability, innovation, and competitive dynamics that have made U.S. financial markets the strongest globally.

MCOA Should Be a Congressional Priority
Jun 12, 2025

AFSA today sent a request to Capitol Hill encouraging the reintroduction of the “Modernizing Credit Opportunities Act” (MCOA), which has been introduced in previous sessions but not in the current 119th Congress. This legislation… Read the rest

“One Big Beautiful Bill” Update
Jun 12, 2025

Last week, the Senate Banking Committee unveiled its portion of the “One Big Beautiful Bill (OBBB),” as President Trump’s top policy priorities move through Congress.

Senate Banking proposed to eliminate funding transferred from… Read the rest

Student Loan Strain?
Jun 12, 2025

The total balance on Americans’ student loans was $1.6 trillion as of the first quarter of this year, according to the Federal Reserve Bank of New York. This is roughly equal to the balance on outstanding auto loans, coming in behind only mortgages… Read the rest

Courts and Policymakers Get It Right
Jun 06, 2025

For more than a hundred years the “Valid When Made” rule served the financial services industry, as well as its customers, well. However over the years state policymakers and the federal courts have taken legislative and judicial steps that

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AFSAEF Empowers with MoneySKILL®
Jun 05, 2025

This week the AFSA Education Foundation had the privilege of connecting with financial literacy advocates and educators at two events. These gatherings provided meaningful opportunities for the foundation to showcase its free resources,… Read the rest

AFSA Webinars | Built to Perform: The AI Models Powering the Next Era of Auto Finance
Jun 04, 2025

Join us Thursday, June 12th at 2:00 p.m. EST

Your Next Performance Upgrade Is in Your Process.

Agentic AI and Intelligent Document Processing are reengineering the auto finance experience – slashing funding times, automating workflows,

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AFSA Alerts the Federal Trade Commission about Holder Rule Effects
Jun 02, 2025

Last week, AFSA responded to the Federal Trade Commission’s (FTC) request for feedback about regulations that create impediments to competition. Our letter shared concerns about how the FTC has shifted policy regarding the Holder Rule … Read the rest

This Thursday | AFSA Webinar | Using Effective Digital Engagement to Cut Call Volume, Increase Self-Service & Get Paid Faster
Jun 02, 2025

Join us Thursday, June 5th at 2:00 p.m. EST

Auto finance portals are failing to meet customer expectations— according to a recent study, only 2% of industry websites and mobile apps provide a truly valuable digital experience. When portals

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AFSA Supports Reconciliation
May 30, 2025

Last week, AFSA, along with other associations, signed a letter supporting the reconciliation bill in the U.S. House. This legislation builds on the 2017 Tax Cuts and Jobs Act by extending and strengthening key provisions that fuel … Read the rest

AFSA Continues to Oppose Rate Caps
May 30, 2025

Last week, AFSA, along with other associations, signed a letter to U.S. Senate leadership opposing Amendment 2239 to S. 1582, which proposes an all-in annual percentage rate (APR) cap of 10% for credit cards. While this amendment claims … Read the rest

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