NCRC, Woodstock Institute Are Pleased With Enova’s Bank Application Withdrawal

Enova Withdraws Bank Bid Tied to Rhode Island Rate Caps

Enova International withdrew its applications to buy Grasshopper Bank and form a Utah-based national bank, a plan consumer advocates said could have let the NetCredit lender export rates far above Rhode Island's usury caps. NetCredit still advertises loans in Rhode Island at up to 99.99% APR through partner banks.

NCRC, Woodstock Institute Are Pleased With Enova’s Bank Application Withdrawal

Yesterday, Enova International Inc. (Enova) – a high-cost online lender that makes loans that many consumers and small businesses cannot afford – announced that it was no longer pursuing a merger with Grasshopper Bank, N.A. In its announcement, it indicated that “outside advocacy” played a role in its decision to withdraw its application.  The National Community Reinvestment Coalition (NCRC) and the Woodstock Institute (Woodstock) strongly advocated against the merger and welcome this news. In addition to making multiple requests with other groups to meet with Enova and the Federal Reserve, the organizations submitted comment letters to the Federal Reserve and the Office of the Comptroller of the Currency (OCC) strongly opposing Enova’s merger and bank holding company applications.   “It is gratifying to see that the advocacy of NCRC, Woodstock and other groups made a difference,” said Tara Flynn, NCRC’s policy director. “Enova’s lending products far exceed state rate caps and allowing it to become a bank would have been bad for low-and moderate-income consumers, communities, small businesses, as well as the safety and soundness of the financial system.”   “Enova’s business model of charging predatory interest rates to struggling consumers and small businesses is in direct conflict with the high standards that come with the privilege of holding a bank charter,” said Jane Doyle, Woodstock’s director of policy. “Enova’s attempt to obtain a bank charter sparked an overwhelming public outcry — from state attorneys general across the country, consumer bankruptcy attorneys, consumer advocacy organizations and more. We’re proud to have been a part of that chorus. Enova’s retreat from its proposed acquisition of Grasshopper is good news for consumers, small businesses and their communities.”  To read the full comment letter, visit:  NCRC, Woodstock Institute Urge OCC, Federal Reserve To Deny Bank Merger Between Enova and Grasshopper Bank – NCRC