• It remains to be seen if the proposed rule were to be finalized as proposed, whether banks, credit unions and nonbanks would be able to make a profitable short-term lending product or if they will leave this segment of the market altogether. If that is the case, who or what will provide short-term lending in the future? Some would argue it is the post office. • The request for information signals an even more expansive reach into the products and practices of lenders in the short-term and longer-term lending markets. This signals a future crackdown above and beyond the contemplated proposed rule. • One of the presumptions of unaffordability is if a borrower expresses an inability to repay. For storefront lenders, this could lead to a “he said, she said” situation, and those lenders may have difficulty recording/documenting that. • Recordkeeping requirements under the proposed rule are 36 months.

Lenders must comply with specific and complex requirements for tabular format. This will require system changes and enhancements that small lenders may find costly. • Given the length and complexity of the 1,300-page proposed rule, please reach out to members of Pepper Hamilton’s Marketplace Lending team for answers to any additional questions that arise, specifically, Richard P. Eckman, Gregory J.

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