November 7, 2024

The Republican Party is poised to gain control of the Administration, the Senate, and the House early next year. As such we expect a more amiable regulatory and legislative environment in DC. We may leverage this friendlier climate to shift into offense on issues like bank discontinuance and data/privacy protection. While we always anticipate the usual efforts by rate cap legislation proponents, we don’t expect those endeavors to gain traction in the new environment. We do, however, remain wary and vigilant about potential threats to our business. In DC we continue in the bipartisan education of lawmakers, keeping friends and cultivating new ones. It’s important at home we remain focused on compliance and serving customers.

As of this update, Donald Trump is the definitive winner of the race for President having secured over 270 electoral college votes. Additionally, he has won a majority of the popular vote. We expect the President to push for less regulation early on. We also anticipate business-friendly tax policy and immigration reform to be important during the administration’s first few months. Significant changes to regulatory agencies are expected, especially at the CFPB where President-Elect Trump has promised new leadership. The new leadership will likely focus less on so-called “junk fees” and small-dollar loans and more on fostering a favorable enforcement and rulemaking landscape.

Senate Republicans will have a controlling majority, but the question remains: by how many seats? The GOP has locked up 52 and has a good chance of securing a 56-seat majority. This would be the largest margin of control in many years by either Party. Generally, 60 votes are needed to get things done in the Senate. Unless Republicans remove the filibuster, which they have pledged not to do, they will need to work with Democrats to pass legislation. On certain measures, significantly tax reform, the reconciliation process can be utilized, only requiring a simple majority vote. Our central focus in the Senate has always been the Banking Committee. Replacing Chairman Brown (D-OH) will likely be Senator Tim Scott (R-SC). We have enjoyed a good working relationship with Senator Scott. On the Democratic side, the Ranking Member will likely be Senator Elizabeth Warren (D-MA) or Senator Jack Reed (D-RI). The committee might take action on Bank De-risking, BSA/AML Reform, Bank Partnerships with fintechs, CFPB reform, and Data Security/Privacy Protection Legislation.

Many races in the House remain undetermined, but Republicans will retain at least a slim majority. Republicans will need to be aligned to get bills passed and/or they will need to garner Democratic support. Misalignment plagued Republicans in the House this Congress. They will need to start the next Congress unified November 13th when both House and Senate Republicans hold leadership elections. For the NPA, we direct most of our attention in the House to the Financial Services Committee. The current Chairman, Rep. Patrick McHenry (R-NC), is leaving Congress and we expect Rep. Andy Barr (R-KY) or Rep. French Hill (R-AR) to take the gavel. Fortunately, we have enjoyed a good relationship with both these lawmakers. Ranking Member contenders on the other side of the aisle are Rep. Maxine Waters (D-CA), Rep. Gregory Meeks (D-NY), Rep. Brad Sherman (D-CA) or Nydia Velázquez (D-NY). The NPA has had good relationships with all these offices in the past as well. We expect the policy reform agenda to be similar to the Senate Banking Committee.

This spring, we hold our annual Legislative Conference in Washington DC from April 29th to May 1st. This is your chance to meet your representatives where they work and learn about the legislative process. It’s also a time for fellowship; connecting with colleagues in the pawn business and meeting key NPA stakeholders.