New Jersey attorney general urges federal regulators to reject OppFi’s national bank charter bid
TRENTON, N.J. — New Jersey Attorney General Jennifer Davenport has joined a coalition of 17 attorneys general urging federal regulators to deny online lender OppFi’s application to acquire and merge with BNC National Bank, arguing the move would allow the company to sidestep state consumer lending laws.
The coalition sent letters to the Office of the Comptroller of the Currency and the Federal Reserve Board, asking the agencies to reject OppFi’s application for a national bank charter.
According to the attorneys general, granting the charter would allow OppFi to expand its high-interest lending nationwide while bypassing state interest rate caps designed to protect consumers from predatory loans.
“New Jersey’s usury laws are designed to shield borrowers from predatory lenders that want to exploit the affordability crisis with expensive and unaffordable loan products,” Davenport said. “Granting a bank charter to OppFi would give it a permission slip to violate our laws, and I won’t allow triple-digit interest rates on borrowers who can least afford them.”
“OppFi has not demonstrated the responsible lending practices we should expect from publicly insured banks,” said Christopher Peterson, acting director of the New Jersey Division of Consumer Affairs. “Our federal regulators must not legitimize and facilitate predatory debt traps.”
State officials said OppFi markets installment loans to consumers with low credit scores or financial difficulties, with annual percentage rates reaching nearly 200%. The coalition contends the company currently relies on partnerships with Utah-chartered banks to issue loans at interest rates that would otherwise violate lending laws in states such as New Jersey.
Under New Jersey law, written consumer loan contracts under $50,000 generally cannot exceed a 16% annual percentage rate under the state’s civil usury law, while loans to individuals with annual interest rates above 30% may violate the state’s criminal usury law.
The coalition argues that acquiring a nationally chartered bank would allow OppFi to take advantage of provisions in the National Bank Act, enabling it to offer loans at interest rates permitted in its home state across the country, regardless of individual state caps.
The announcement also noted that New Jersey previously challenged the federal government’s 2020 “True Lender Rule,” which critics said would have allowed nonbank lenders to evade state interest rate limits through partnerships with banks. The rule was repealed in 2021.
Attorneys general from Arizona, California, Connecticut, the District of Columbia, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, North Carolina, Oregon, Rhode Island, Vermont, Virginia and Washington also joined the letters opposing OppFi’s application.
