I 
113TH CONGRESS 
1ST SESSION H. R. 1566 
To create a Federal charter for Internet consumer credit corporations, and 
for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 15, 2013 
Mr. LUETKEMEYER (for himself and Mr. MEEKS) introduced the following bill; 
which was referred to the Committee on Financial Services 
A BILL 
To create a Federal charter for Internet consumer credit 
corporations, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Consumer Credit Ac-
cess, Innovation, and Modernization Act’’. 
SEC. 2. FINDINGS; PURPOSE; AND INTENT. 
(a) FINDINGS.—Congress finds the following: 
(1) Studies by the Federal Deposit Insurance 
Corporation (FDIC), National Bureau of Economic 
Research, FINRA Investor Education Foundation, 
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and other credible parties have shown that roughly 
half of all American families, including not only 
lower and moderate income families but also a large 
segment of middle and higher income families who 
have poor credit scores and limited disposable in-
comes, are literally living paycheck-to-paycheck, 
lacking adequate savings and other resources to 
cover unplanned expenses that frequently arise in 
every household. 
(2) These consumers (in this Act referred to as 
‘‘underserved consumers’’) include those who are 
‘‘unbanked’’, having neither a checking or savings 
account at a depository institution, and those who 
are ‘‘underbanked’’, having such an account and fre-
quently having higher incomes but credit impair-
ments, while nonetheless needing to rely on non-
depository financial institutions for short-term, small 
loans and other credit products and financial serv-
ices they desperately need, but generally cannot ob-
tain from traditional banking institutions. 
(3) Credit alternatives for underserved con-
sumers generally are limited and often not well suit-
ed to their particular needs and in some instances 
lack any statutory consumer protections. 
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(4) Programs by the FDIC and other parties to 
expand access to small loans and other financial 
products or services for underserved consumers 
through banking institutions have had very limited 
success because banks, which typically have rel-
atively high operating costs, generally have been un-
able to make affordable small personal loans on a 
widespread, commercially viable basis to these higher 
risk consumers, most of whom may not even qualify 
for a loan under the high-credit standards regulators 
necessarily require insured depositories to maintain. 
(5) To the extent that depository institutions 
offer underserved consumers affordable small loans 
and other financial products or services on a com-
mercially viable basis, they should be encouraged to 
do so, but it must be recognized that overcoming the 
practical business obstacles for depositories to offer 
such products or services appears to be quite dif-
ficult at best for most depositories, and given the 
massive scope of the short-term credit needs of such 
consumers, depositories most likely will be unable to 
provide affordable small loans and other financial 
products or services for a significant number of 
them. 
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(6) Efforts of governmental, nonprofit, and pri-
vate sector institutions to help underserved con-
sumers manage their personal finances more effec-
tively through financial education and counseling 
programs also are important and must continue, but 
given the tremendous number of consumers who face 
significant ongoing financial challenges, most such 
underserved consumers are likely to be unable to 
overcome their financial difficulties through such ef-
forts. 
(7) Nondepository creditors historically have 
been primarily State-regulated, are not federally in-
sured, generally pose little or no systemic or tax-
payer risk, typically have lower operating costs and 
can employ less restrictive credit standards than de-
positories, and are a major source of small loans and 
financial products or services for underserved con-
sumers, providing such consumers annually with bil-
lions of dollars in credit. 
(8) A number of nondepository creditors have 
developed advanced proprietary loan underwriting 
and servicing procedures and cutting-edge tech-
nologies allowing them to offer credit to more under-
served consumers, but such creditors lack the au-
thority available to national banks to operate on a 
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multistate or nationwide basis using a single lending 
charter and subject to strong, uniform Federal regu-
lation that would enable them to maximize their ca-
pacities to operate more innovatively and efficiently. 
(9) Nondepository creditors are instead subject 
to widely differing State licensing laws that impose 
substantial cost and compliance burdens, and, more 
significantly, laws that severely limit the types of fi-
nancial products or services that may be offered, 
prevent loans from being provided on a commercially 
viable basis, stifle innovation, reduce competition, 
and leave underserved consumers with a limited 
choice of products or services that in many cases are 
not well suited to their personal needs and cost sig-
nificantly more because of these conflicting and out-
dated restrictive State laws. 
(10) It is in the national interest and will great-
ly benefit the millions of underserved consumers who 
have pressing needs for additional credit alternatives 
for Congress to adopt legislation to authorize credi-
tors the option of receiving a Federal charter under 
which they can provide such consumers loans and 
other financial products and services through the 
Internet and electronic devices and not traditional 
brick-and-mortar storefront locations, allowing them 
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to operate more innovatively and efficiently on a na-
tionwide basis. 
(11) An Internet consumer credit corporation 
chartered under this Act will be adequately regu-
lated under Federal laws and regulations prescribed 
by the Comptroller of the Currency and the Director 
of the Consumer Financial Protection Bureau, and 
such laws and regulations shall be enforced in ac-
cordance with this Act without such corporation 
being subjected to duplicative and conflicting State 
laws that in many cases severely and unnecessarily 
restrict product innovation and choice and raise the 
cost of the limited credit choices now available to un-
derserved consumers. 
(12) Allowing such federally regulated lending 
by Internet creditors as authorized by this Act 
through the Internet and by electronic devices, but 
not through traditional storefront, brick-and-mortar 
locations, on a nationwide basis, is consistent with 
the fact that consumers’ borrowing habits are shift-
ing rapidly to seeking more financial product and 
service choices with the convenience, ease of credit 
access, and more alternatives provided by computers, 
mobile phones, and other electronic devices, and mil-
lions of underserved consumers will be able to secure 
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credit from Internet consumer credit corporations 
that are subject to applicable State and Federal 
laws. 
(13) Small businesses, which are vital to job 
creation and the health of the Nation’s economy, 
also have a continuing need for additional credit al-
ternatives, and allowing Internet consumer credit 
corporations to offer certain financial products and 
services to small businesses through the Internet 
and by electronic devices will be in the national in-
terest. 
(b) PURPOSE AND INTENT.—The purpose and intent 
of this Act is to— 
(1) provide underserved consumers greater ac-
cess to innovative, affordable, commercially viable, 
and better suited financial products and services; 
(2) create a Federal charter for creditors that 
offer financial products or services through the 
Internet and electronic devices and not traditional 
brick-and-mortar storefront locations and focus their 
business primarily on meeting the credit needs of 
underserved consumers and small businesses, ena-
bling such Internet creditors to provide more innova-
tive, affordable, and appropriate credit options, sub-
ject to uniform Federal lending standards rather 
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than operating under the widely varying, often con-
flicting, overly restrictive, and unnecessarily costly 
system of State lending laws that currently prevent 
nondepository creditors from offering underserved 
consumers and small businesses the credit options 
they need; 
(3) clarify that Congress understands that even 
with the more innovative and efficient lending au-
thorized by this Act and reasonable pricing by Inter-
net consumer credit corporations, the cost of com-
mercially viable, short-term, small-dollar credit for 
higher risk underserved consumers typically will be 
considerably higher than the cost for other con-
sumers who have no credit impairments and that 
when the cost of such credit is expressed in terms 
of an annual percentage rate, in most cases such 
rate will be much higher than such rate for larger, 
longer term loans, especially those made to con-
sumers with unimpaired credit records, and there-
fore it should not be presumed or necessarily con-
cluded that such credit extensions to underserved 
consumers are unfair or abusive, provided full disclo-
sure of the cost of such credit is made as required 
by this Act and such corporation has a reasonable 
basis for determining that an underserved consumer 
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can repay, therefore indicating that the credit is af-
fordable; 
(4) require that the Comptroller exercise his or 
her authorities to administer, enforce, and imple-
ment the provisions of this Act and regulations pre-
scribed pursuant to this Act to provide for ongoing 
prudential regulatory oversight of Internet consumer 
credit corporations and to promptly adopt reasonable 
and flexible policies and procedures to ensure the ap-
proval of Federal charters for qualified applicants, 
while also promoting the offering of innovative, af-
fordable, and commercially viable financial products 
or services; and 
(5) require that the Director exercise his or her 
authorities to administer, enforce, and implement 
the provisions of Federal consumer financial laws 
and applicable provisions of this Act and regulations 
prescribed pursuant to this Act to ensure that un-
derserved consumers receive effective consumer fi-
nancial protections, while also promoting the offer-
ing of innovative, affordable, and commercially viable 
financial products or services. 
SEC. 3. INTERNET CONSUMER CREDIT CORPORATIONS. 
(a) FEDERAL CHARTER.—In accordance with the 
provisions of this Act, and regulations prescribed pursuant 
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to this Act, the Comptroller shall charter creditors which 
shall become Internet consumer credit corporations (here-
inafter referred to as ‘‘Internet creditors’’) to offer finan-
cial products or services primarily to underserved con-
sumers and small businesses as provided for in this Act. 
(b) APPLICATION REQUIRED.— 
(1) IN GENERAL.—A person that desires to ob-
tain a Federal charter under this Act shall submit 
an application to the Comptroller at such time, in 
such manner, and accompanied by such information 
as the Comptroller may require. 
(2) 
EXPEDITIOUS
DETERMINATION.—The 
Comptroller shall make a determination as to wheth-
er an application submitted under paragraph (1) is 
approved or denied expeditiously. 
(c) REQUIREMENTS.—In seeking a Federal charter 
under this Act, an applicant shall meet the following re-
quirements: 
(1) A business plan shall be established cov-
ering at least the initial 3-year period of operation 
as a commercially viable entity with its primary 
business activities being to serve the needs of under-
served consumers and small businesses for credit 
and related financial services through the Internet 
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and electronic devices and not through brick-and- 
mortar locations, and such plan shall— 
(A) realistically forecast market demand, 
the intended customer base, competition, eco-
nomic conditions, financial projections, and 
business risks; 
(B) include a marketing plan that de-
scribes the types of financial products or serv-
ices such creditor intends to offer, how it will 
market them, and how such products or serv-
ices are expected to be affordable for under-
served consumers and small businesses and 
commercially viable for the creditor; and 
(C) contain an acceptable plan for— 
(i) ensuring compliance with all appli-
cable laws and regulations; and 
(ii) for promptly addressing com-
plaints from underserved consumers and 
small businesses. 
(2) A competent and experienced management 
team of good moral character with expertise in and 
a commitment to serving the credit needs of under-
served consumers, experience in offering financial 
services products to consumers through the Internet 
or electronic devices, and awareness and under-
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standing of applicable legal requirements shall be es-
tablished. 
(3) Adequate capital structure relative to the 
operational and financial assumptions and business 
plans of the applicant, including the cost of utilizing 
advanced technology and information management 
systems for its operating and compliance needs, shall 
be established. 
(4) No Internet creditor shall be directly or in-
directly owned or controlled by any person unless— 
(A) the person is an individual, a Federal- 
or State-chartered depository institution, a 
bank holding company (as defined in section 
2(a) of the Bank Holding Company Act of 
1956 (12 U.S.C. 1841(a))), a savings and loan 
holding 
company 
(as 
defined 
in 
section 
10(a)(1)(D) of the Home Owners’ Loan Act 
(12 U.S.C. 1467a(a)(1)(D))), or a nonprofit 
corporation; or 
(B) the primary business activity of the 
person involves— 
(i) providing financial products or 
services to consumers; or 
(ii) owning or controlling persons 
whose primary business activity is pro-
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viding financial products or services to con-
sumers. 
(5) Any other requirements provided for under 
this Act or in regulations prescribed by the Comp-
troller consistent with the purposes of this Act. 
(d) AUTHORITY OF INTERNET CREDITORS.—Upon 
receiving a Federal charter pursuant to subsection (a), an 
Internet creditor shall become, as from the date of the 
execution of its charter, a body corporate, and, as such, 
an Internet consumer credit corporation, and in the name 
designated in the charter it is authorized to— 
(1) adopt and use a corporate seal; 
(2) have succession from the date its charter is 
issued until such time as it be dissolved by the act 
of its shareholders owning two-thirds of its stock, or 
until its charter is revoked by the Comptroller, or 
until terminated by an Act of Congress, or until its 
affairs are placed in the hands of a receiver and fi-
nally wound up by the receiver in accordance with 
title 11, United States Code, or other applicable law; 
(3) borrow money, issue stock, and enter into 
contracts; 
(4) sue and be sued and complain and defend, 
in any court of law and equity of competent jurisdic-
tion, as fully as natural persons; 
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(5) elect or appoint directors, and by its board 
of directors to appoint a president, vice president, 
and other officers, define their duties, require bonds 
of them and fix the penalty thereof, dismiss such of-
ficers or any of them at pleasure, and appoint others 
to fill their places; 
(6) prescribe, by its board of directors, bylaws 
not inconsistent with law, regulating the manner in 
which its stock shall be transferred, its directors 
elected or appointed, its officers appointed, its prop-
erty transferred, its general business conducted, and 
the privileges granted to it by law exercised and en-
joyed; 
(7) hire employees and consultants and fix their 
compensation, define their duties, and give such per-
sons appropriate authority to carry on its business 
operations; 
(8) enter into joint ventures and other business 
partnerships with other Internet creditors, deposi-
tory institutions, State-chartered or licensed non-
depository creditors, third-party service providers 
and vendors, and other parties to promote or facili-
tate providing as herein authorized commercially via-
ble financial products or services to underserved con-
sumers and small businesses; 
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(9) contribute to community funds, or to chari-
table, philanthropic, or benevolent instrumentalities 
conducive to public welfare, such sums as its board 
of directors may deem expedient and in the interests 
of the Internet creditor; 
(10) invest in, or buy or lease, real estate or 
tangible personal property, including vehicles, equip-
ment, furnishings and furniture, to be used by the 
Internet creditor in conducting business related op-
erations authorized under this Act; 
(11) provide loans and other financial services 
only through the Internet and electronic devices as 
its board of directors or duly authorized officers or 
agents may determine, in accordance with this Act 
and regulations prescribed pursuant to this Act, are 
appropriate for providing financial products or serv-
ices to consumers, including underserved consumers, 
and to small businesses in accordance with the pro-
visions of this Act and regulations prescribed pursu-
ant to this Act; 
(12) exercise by its board of directors or duly 
authorized officers or agents, subject to law, all such 
incidental, implied, or reasonably necessary powers 
as may be appropriate to carry on its corporate op-
erations and the business of providing commercially 
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viable financial products or services to consumers, 
including underserved consumers and small busi-
nesses in accordance with the provisions of this Act 
and regulations prescribed pursuant to this Act; 
(13) be affiliated with, or owned by, an insured 
depository institution, nondepository creditor, non-
profit organization, or other qualified entities unless 
otherwise limited by this Act or regulations pre-
scribed pursuant to this Act; 
(14) acquire or merge with other Internet credi-
tors; and 
(15) exercise such other powers as may be rea-
sonably necessary or appropriate to offer financial 
products or services as provided for pursuant to this 
Act, or provided for through regulations prescribed 
by the Comptroller pursuant to the provisions of this 
Act. 
(e) DUTIES AND RESPONSIBILITIES.— 
(1) COMPTROLLER
OF
THE
CURRENCY.—The 
Comptroller shall— 
(A) ensure that Internet creditors only 
provide loans and other financial products or 
services through the Internet and electronic de-
vices and that, to the extent reasonably pos-
sible, such creditors primarily focus their busi-
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ness operations on providing underserved con-
sumers a variety of affordable financial prod-
ucts or services that are commercially viable for 
such creditors, including certain products or 
services that contain features to facilitate per-
sonal savings and enhance the credit record of 
such consumers; 
(B) encourage and facilitate— 
(i) innovation with respect to the fi-
nancial products or services offered to un-
derserved consumers; and 
(ii) joint ventures and other business 
partnerships among Internet creditors, in-
sured depository institutions, other non-
depository creditors, third-party service 
providers and vendors, nonprofit organiza-
tions, and other parties in order to ensure 
greater credit access for underserved con-
sumers and small businesses; 
(C) provide, through regulations, details on 
how Internet creditors should be organized, in-
corporated, and operated in a prudential man-
ner; 
(D) conduct examination and supervisory 
activities of Internet creditors to— 
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(i) access their internal controls and 
management ability; 
(ii) evaluate their financial condition 
and risk profile; 
(iii) determine if they are meeting the 
needs of underserved consumers and small 
businesses; and 
(iv) monitor their compliance with this 
Act and other applicable laws and regula-
tions that the Comptroller may have ad-
ministrative responsibly for, and identify 
areas in which corrective action is needed; 
(E) consult, cooperate and coordinate, as 
appropriate, with the Director and with other 
Federal and State regulatory agencies, includ-
ing State bank supervisors, to promote much 
greater availability of innovative, affordable, 
commercially viable credit for underserved con-
sumers, and consistent regulatory treatment of 
consumer and small business financial products 
and services; 
(F) help ensure that the supervisory activi-
ties, including examination schedules, of Inter-
net creditors and affiliated companies are con-
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ducted in a coordinated and efficient manner; 
and 
(G) adopt adequate safeguards to ensure 
appropriate privacy and confidentiality protec-
tions with respect to individually identifiable 
personal data and proprietary corporate data. 
(2) DIRECTOR OF THE BUREAU OF CONSUMER 
FINANCIAL PROTECTION.—The Director shall— 
(A) regulate the offering and provision of 
consumer financial products or services by 
Internet creditors under the Federal consumer 
financial laws pursuant to its authorities under 
the Dodd-Frank Wall Street Reform and Con-
sumer Protection Act (12 U.S.C. 5301 et seq.), 
this Act, and regulations prescribed pursuant to 
this Act; 
(B) consult, cooperate, and coordinate, as 
appropriate, with the Comptroller and with 
other Federal and State regulatory agencies, in-
cluding State bank supervisors, to promote— 
(i) much greater availability of inno-
vative, 
affordable, 
commercially 
viable 
credit for underserved consumers and 
small businesses; and 
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(ii) consistent regulatory treatment of 
consumer and small business financial 
products or services; 
(C) help ensure that the supervisory activi-
ties, including examination schedules, of Inter-
net creditors and affiliated companies are con-
ducted in a coordinated and efficient manner; 
and 
(D) adopt adequate safeguards to ensure 
appropriate privacy and confidentially protec-
tions with respect to individually identifiable 
personal data and proprietary corporate data. 
(3) INTERNET
CREDITORS.—Each Internet 
creditor shall— 
(A) make financial education information 
available to each consumer it offers a financial 
product or service, including information on 
how a consumer may obtain financial coun-
seling services, the benefits of following a reg-
ular personal savings program, and how con-
sumers can improve their credit ratings; 
(B) comply with all applicable Federal laws 
and regulations, including Federal consumer fi-
nancial protection law requirements and such 
State laws, regulations, and enforcement ac-
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tions as are authorized under the provisions of 
this Act; 
(C) provide account access to its customers 
through the Internet and a toll-free telephone 
number; 
(D) provide, in accordance with regulations 
prescribed pursuant to this Act, to all con-
sumers who are extended credit with a repay-
ment term of 1 year or less by the Internet 
creditor a clear and conspicuous statement in 
the loan agreement that discloses the true cost 
of the loan, including all interest, fees, and 
other loan-related charges, as a dollar amount 
and as a percentage of the principal amount of 
the loan in lieu of the annual percentage rate 
disclosure that otherwise would be required 
under the Truth in Lending Act (15 U.S.C. 
1601 et seq.) or regulations prescribed pursu-
ant to such Act; 
(E) report to the Comptroller or Director 
such data as either may require regarding its 
activities, including the types of financial prod-
ucts or services provided to underserved con-
sumers and small businesses, and data dem-
onstrating that its business activities are fo-
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cused primarily on serving underserved con-
sumers and small businesses as required by this 
Act; 
(F) offer— 
(i) an underserved consumer who is 
unable to repay an extension of credit by 
an Internet creditor that has a loan repay-
ment term of less than 120 days, an ex-
tended repayment plan, at no cost to the 
consumer, at least once in a 12-month pe-
riod; and 
(ii) to the extent reasonably possible, 
certain financial products or services that 
contain features to facilitate personal sav-
ings that could help underserved con-
sumers enhance their credit records if such 
consumers fully comply with the terms and 
conditions of such products or services; 
and 
(G) not— 
(i) accept consumer or commercial de-
posits; 
(ii) make commercial loans, except to 
the extent allowed by the provisions of this 
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Act and regulations prescribed pursuant to 
this Act, with respect to small businesses; 
(iii) make a consumer loan with a 
term of 30 days or less; 
(iv) make a loan that requires a con-
sumer to repay the loan balance in one 
lump-sum payment; or 
(v) extend credit to a consumer— 
(I) unless the Internet creditor 
has a reasonable basis for believing 
that the consumer will have the ability 
to repay the credit extension; 
(II) if the maximum principal 
amount of the credit outstanding from 
all financial products or services au-
thorized by the Internet creditor to 
such consumer, in the case of an un-
secured credit transaction, exceeds 
$5,000, or in the case of a secured 
credit transaction, $25,000, unless a 
higher amount is authorized by regu-
lations prescribed by the Comptroller; 
or 
(III) if the loan terms include a 
prepayment penalty; or 
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(vi) extend credit to a small business 
in excess of $25,000. 
(f) ADDITIONAL PRODUCT
OR SERVICE OFFER-
INGS.—Financial products or services that may be offered 
to underserved consumers pursuant to this subsection for 
underserved consumers and certain small businesses may 
also be offered to other consumers and businesses. 
(g) RULE OF CONSTRUCTION.—Nothing in this Act 
is intended to provide the Comptroller or the Director with 
the authority to— 
(1) regulate financial products or services that 
are provided or offered by an affiliate company or 
another entity that the Internet creditor has a busi-
ness relationship with, but the Internet creditor does 
not provide or offer to underserved consumers or 
small businesses in accordance with this Act; 
(2) determine, directly or indirectly, pricing ap-
plicable to an extension of credit offered by an Inter-
net creditor to a consumer or small business pursu-
ant to this Act through a usury limit, a cap on the 
rate of interest, fees, or other charges, or otherwise; 
(3) prohibit, directly or indirectly, the offering 
of a financial product or service to underserved con-
sumers or small businesses by an Internet creditor 
pursuant to this Act unless a determination is made 
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by the Comptroller or Director, based on a fair and 
reasonable determination of the facts and cir-
cumstances regarding the financial product or serv-
ice, that offering such a product or service will seri-
ously harm the financial interests of underserved 
consumers or small businesses; or 
(4) presume or conclude that a credit extension 
offered to underserved consumers by an Internet 
creditor under the provisions of this Act, regulations 
prescribed by this Act, and such other statutes and 
regulations as either may have administrative and 
enforcement authority for is unfair, abusive, or oth-
erwise inappropriate solely on the basis that the in-
terest rates and other charges to such consumers, 
who typically pose relatively high credit risks, are 
significantly higher than those on credit extensions 
offered to other consumers who do not pose such 
high credit risks. 
(h) INTERNET CREDITOR REGULATORY FEE.—Each 
Internet creditor shall pay to the Comptroller an annual 
fee in a reasonable amount that the Comptroller deter-
mines is sufficient, in the aggregate of all such fees paid 
by Internet creditors, to offset the cost to the Comptroller 
of carrying out the provisions of this Act. 
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(i) CHARTER SUSPENSION
OR REVOCATION.—The 
Comptroller, pursuant to procedures established in regula-
tions prescribed by the Comptroller, may suspend or re-
voke the charter of an Internet creditor if there has been 
a material failure by the Internet creditor to comply with 
the requirements set forth in the charter, provisions of this 
Act, or other applicable statutes, regulations, or orders. 
(j) RELATIONSHIP TO OTHER FEDERAL AND STATE 
LAWS.— 
(1) FEDERAL
LAW.—An Internet creditor is 
subject to— 
(A) all otherwise applicable provisions of 
Federal statutes and regulations, including the 
consumer financial laws listed under section 
1002(14) of the Consumer Financial Protection 
Act of 2010 (12 U.S.C. 5481(14)), section 987 
of title 10, United States Code (relating to con-
sumer credit extended to servicemembers and 
dependents), and the provisions of this Act and 
regulations established pursuant to this Act; 
and 
(B) the administration and enforcement of 
such statutes and regulations by the Comp-
troller, the Director, any other Federal agency, 
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or State attorney general (or the equivalent 
thereof) having enforcement authority. 
(2) STATE LAW.—An Internet creditor, or an 
employee, agent, or other business partner of an 
Internet creditor, shall not be subject to— 
(A) State laws that relate to office loca-
tion, licensing, education, or training that apply 
to the operations of an Internet creditor, or its 
employees, agents, or other business partners to 
the extent that these operations relate to the 
exercise of its powers or authorities under this 
Act and implementing regulations to provide fi-
nancial products or services to underserved con-
sumers and small businesses; or 
(B) other State laws that— 
(i) have a discriminatory effect on an 
Internet creditor compared to the effect of 
such laws on any other depository or non-
depository creditor chartered or licensed in 
that State; 
(ii) consistent with the legal standard 
for preemption in the decision of the Su-
preme Court of the United States in 
Barnett Bank of Marion County, N.A. v. 
Nelson, Florida Insurance Commissioner, 
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et al., 517 U.S. 25 (1996), prevent or sig-
nificantly interfere with the exercise by an 
Internet creditor of its powers and authori-
ties as set forth in this Act; or 
(iii) are preempted by any provision of 
Federal law. 
(3) DETERMINATION
OF
PREEMPTION.—An 
Internet creditor may challenge the applicability of a 
State law as preventing or significantly interfering 
with the exercise of such creditor’s powers under 
this Act, or for violating any provision of paragraph 
(2), in any court of competent jurisdiction, and the 
Comptroller or Director, by regulation or order, or 
any court of competent jurisdiction may make a de-
termination, on a case-by-case basis, that a State 
law prevents or significantly interferes with the exer-
cise of an Internet creditor’s powers under this Act, 
or violates a provision of paragraph (2), in accord-
ance with applicable law. 
(k) ENFORCEMENT.— 
(1) IN GENERAL.—The Comptroller or the Di-
rector may enforce in any court of competent juris-
diction the provisions of this Act, regulations pre-
scribed pursuant to this Act relating to their respec-
tive regulatory authority in this Act, and their re-
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spective cease and desist or other orders or regu-
latory requirements. 
(2) ACTION BY STATE.—The attorney general 
(or the equivalent thereof) of any State shall have 
the power to investigate violations of this Act and 
may bring a civil enforcement action in the name of 
such State against an Internet creditor in any dis-
trict court of the United States or in State court 
that has jurisdiction over the Internet creditor and 
to secure civil penalties and such other remedies 
under provisions of this Act or otherwise provided 
under other applicable law. 
(3) CONSULTATION REQUIRED.— 
(A) NOTICE.— 
(i) IN GENERAL.—When initiating any 
action in a court or other administrative or 
regulatory proceeding against any Internet 
creditor as authorized by this Act to en-
force any provision of this Act, including 
any regulation pursuant to this Act, a copy 
of the complete complaint filed or to be 
filed and written notice describing such ac-
tion or proceeding shall be provided to the 
Comptroller and the Director by the State 
attorney general (or the equivalent thereof) 
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prior to or immediately upon instituting 
the action or proceeding. 
(ii) CONTENTS OF NOTICE.—The noti-
fication required under this paragraph 
shall, at a minimum, describe— 
(I) the identity of the parties; 
(II) the alleged facts underlying 
the proceeding; and 
(III) whether there may be a 
need to coordinate the prosecution of 
the proceeding so as not to interfere 
with any action, including any rule-
making, undertaken by the Comp-
troller or the Director. 
(B) COMPTROLLER
AND
DIRECTOR
RE-
SPONSE.—In any action brought by a State at-
torney general (or equivalent thereof), the 
Comptroller and Director may— 
(i) intervene in the action as a party; 
and 
(ii) upon intervening— 
(I) remove the action to the ap-
propriate United States district court, 
if the action was not originally 
brought there; 
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(II) be heard on all matters aris-
ing in the action; and 
(III) appeal any order or judg-
ment, to the same extent as any other 
party in the proceeding may. 
(4) REGULATIONS.—The Comptroller and the 
Director shall jointly prescribe regulations to imple-
ment the requirements of this subsection and, from 
time to time, consult with State attorneys general 
(or the equivalent thereof) in order to develop appro-
priate protocols to coordinate actions with the State 
attorneys general and other appropriate regulators. 
(5) PRESERVATION OF STATE AUTHORITY.—No 
provision of this Act shall be construed as modi-
fying, limiting, or superseding the operation of any 
provision of any Federal consumer financial protec-
tion law or regulations prescribed pursuant to such 
laws that relates to the authority of a State attorney 
general (or the equivalent thereof) to enforce such 
Federal law and regulations. 
(l) PENALTIES FOR VIOLATIONS.—The relief avail-
able for violations of provisions of this Act, regulations 
prescribed pursuant to this Act, or orders or supervisory 
mandates, including cease and desist orders, with respect 
to proceedings involving Internet creditors by the Comp-
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troller, the Director, or State attorneys general (or the 
equivalent thereof) shall be the same as or equivalent to 
that provided with respect to actions by the Director in 
section 1055 of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act (12 U.S.C. 5565). 
(m) REPORTS TO CONGRESS.—Not later than 180 
days after the effective date of this Act, and annually for 
5 years thereafter, the Comptroller and the Director shall 
submit to Congress a joint report on their activities and 
progress in helping to expand access to innovative and af-
fordable credit for underserved consumers and small busi-
nesses, and such reports shall include— 
(1) a descriptive summary of the actions of the 
Comptroller and the Director during the reporting 
period to carry out the purposes of this Act; 
(2) the number of charter applications received 
by the Comptroller; 
(3) the number of charter applications that 
were approved, disapproved, conditionally approved, 
or are pending and a detailed explanation of each 
disapproval or conditional approval; 
(4) a description of any further actions the 
Comptroller or the Director believes should be un-
dertaken to— 
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(A) facilitate the chartering of qualified 
nondepository institutions; and 
(B) increase the number of financial prod-
ucts that are available to help increase competi-
tion and consumer choice for underserved con-
sumers; and 
(5) any recommendations the Comptroller or 
the Director may have regarding other legislative 
measures that would improve the ability of an Inter-
net creditor to provide additional financial products 
or services to underserved consumers or small busi-
nesses. 
(n) REGULATIONS.—The Comptroller and the Direc-
tor shall consult and prescribe joint regulations imple-
menting the provisions of this Act not later than 180 days 
after the effective date of this Act. 
SEC. 4. DEFINITIONS. 
In this Act: 
(1) AFFILIATE.—The term ‘‘affiliate’’ means 
any person that controls, is controlled by, or is 
under common control with another person. 
(2) 
AFFORDABLE.—The 
term 
‘‘affordable’’ 
means that a creditor has a reasonable expectation 
that a consumer or small business will be able to 
repay an extension of credit. 
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(3) COMMERCIALLY VIABLE.—The term ‘‘com-
mercially viable’’ means that a reasonable economic 
profit is expected to be made when a financial prod-
uct or service is provided to a consumer or small 
business. 
(4) COMPTROLLER.—The term ‘‘Comptroller’’ 
means the Comptroller of the Currency. 
(5) CONSUMER.—The term ‘‘consumer’’ means 
an individual or agent, trustee, or representative act-
ing on behalf of an individual. 
(6) CONTROL
AND
CONTROLLED
BY.—The 
terms ‘‘control’’ and ‘‘controlled by’’ mean that— 
(A) a person directly or indirectly or acting 
through 1 or more other persons owns, controls, 
or has power to vote 25 percent or more of any 
class of voting stock of a company; 
(B) a person controls in any manner the 
election of a majority of the directors or trust-
ees of a company; or 
(C) the Comptroller makes a determina-
tion, after notice and opportunity for hearing, 
that a person directly or indirectly exercises a 
controlling influence over the management or 
policies of a company. 
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(7) CREDIT.—The term ‘‘credit’’ means the 
right granted by a person to a consumer or a small 
business to defer payment of a debt, incur debt and 
defer its payment, or purchase property or services 
and defer payment for such purchase. 
(8) CREDITOR.—The term ‘‘creditor’’ has the 
same meaning as is given such term in section 
103(g) of the Truth in Lending Act (15 U.S.C. 
1602(g)), and for purposes of this Act, shall include 
a person who extends credit to a small business pur-
suant to the provisions of this Act. 
(9) DIRECTOR.—The term ‘‘Director’’ means 
the Director of the Bureau of Consumer Financial 
Protection. 
(10) ELECTRONIC
DEVICE.—The term ‘‘elec-
tronic device’’ means an electronic device that com-
municates by any transfer of signs, signals, writing, 
images, sounds, data, or intelligence of any nature 
transmitted in whole or in part by a wire, radio, 
electromagnetic, photoelectronic, or photo-optical 
system that affects interstate or foreign commerce. 
(11) EXTENDED REPAYMENT PLAN.—The term 
‘‘extended repayment plan’’ means an installment 
plan under which a consumer who is unable to repay 
a credit extension on a loan with a term of less than 
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120 days on the date due, and who complies with 
applicable requirements established in regulations 
pursuant to this Act, may repay a creditor the out-
standing balance of the loan in at least 4 substan-
tially equal payments without being charged any ad-
ditional interest, fees, or other charges. 
(12) FEDERAL CONSUMER FINANCIAL LAWS.— 
The term ‘‘Federal consumer financial laws’’ has the 
same meaning as is given to that term in section 
1002(14) of the Consumer Financial Protection Act 
of 2010 (12 U.S.C. 5481(14)). 
(13) FINANCIAL PRODUCT OR SERVICE.—The 
term ‘‘financial product or service’’ has the same 
meaning as is given the term ‘‘consumer financial 
product or service’’ in section 1002(5) of the Con-
sumer Financial Protection Act of 2010 (12 U.S.C. 
5481(5)), and for purposes of this Act, shall also in-
clude a financial product or service provided to a 
small business. 
(14) INSURED DEPOSITORY INSTITUTION AND 
DEPOSITORY INSTITUTION.—The terms ‘‘insured de-
pository institution’’ and ‘‘depository institution’’ 
(also referred to herein as ‘‘depositories’’) have the 
same meanings as are given such terms under sec-
tion 3(c) of the Federal Deposit Insurance Act (12 
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U.S.C. 1813(c)), and for purposes of this Act, also 
includes an ‘‘insured credit union’’ as such term is 
defined under section 101(7) of the Federal Credit 
Union Act (12 U.S.C. 1752(7)). 
(15) INTERNET.—The term ‘‘Internet’’ means 
the international computer network of interoperable 
packet-switched data networks. 
(16) NONDEPOSITORY
CREDITOR.—The term 
‘‘nondepository creditor’’ means an entity that is 
chartered or licensed by a State and offers personal 
loans or other financial products or services to con-
sumers or small businesses, but does not accept con-
sumer or commercial deposits. 
(17) PERSON.—The term ‘‘person’’ means an 
individual, partnership, company, corporation, asso-
ciation (incorporated or unincorporated), trust, es-
tate, cooperative organization, or any other entity. 
(18) PRIMARY
BUSINESS
ACTIVITIES.—The 
term ‘‘primary business activities’’ means that the 
business activities of an Internet creditor predomi-
nately involve providing financial products and serv-
ices to underserved consumers and small businesses. 
(19) SECURED
CREDIT
TRANSACTION.—The 
term ‘‘secured credit transaction’’ means— 
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(A) a consumer credit transaction where 
the performance of the credit obligation is se-
cured by an interest in property; and 
(B) such transaction is recognized as se-
cured by State or Federal law, provided, how-
ever, a consumer’s authorization for an elec-
tronic fund transfer as a payment on a finan-
cial product or service shall not be considered, 
for purposes of this Act, as security on a credit 
transaction. 
(20) SMALL BUSINESS.—The term ‘‘small busi-
ness’’ means a business entity, including a sole pro-
prietorship, that has less than 500 full-time employ-
ees. 
(21) STATE.—The term ‘‘State’’ means— 
(A) a State, territory, or possession of the 
United States, the District of Columbia, the 
Commonwealth of Puerto Rico, the Common-
wealth of the Northern Mariana Islands, Guam, 
American Samoa, and the United States Virgin 
Islands. 
(22) UNDERSERVED
CONSUMER.—The term 
‘‘underserved consumer’’ means a natural person 
who— 
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(A) does not have a checking or savings 
account with an insured depository institution; 
or 
(B) has a deposit account with an insured 
depository institution, but has limited or no 
ability to obtain small personal loans or other 
nondepository financial products or services 
from an insured depository institution. 
(23) UNSECURED CREDIT TRANSACTION.—The 
term ‘‘unsecured credit transaction’’ means a con-
sumer credit transaction where the performance of 
the credit obligation is not secured by an interest in 
property or where the security interest is not recog-
nized by State or Federal law. 
SEC. 5. CONFORMING AMENDMENT TO TILA. 
Section 104 of the Truth in Lending Act (15 U.S.C. 
1603) is amended by adding at the end the following: 
‘‘(8) Credit transactions involving extensions of 
credit with a term of 1 year or less in which the 
creditor provides consumers in all such credit trans-
actions with a clear and conspicuous statement in 
the loan agreement that discloses the true cost of 
the loan, including all interest, fees, and other loan 
related charges, as a dollar amount and as a per-
centage of the principal amount of the loan.’’. 
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SEC. 6. EFFECTIVE DATE. 
This Act shall be effective 180 days after the date 
of the enactment of this Act. 
Æ 
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