After a long wait, the Consumer Financial Protection Bureau (CFPB) is set to release its Notice of Proposed Rulemaking (NPRM) for debt collection on or around Wednesday. Here are a few things debt collectors should do to prepare in these final few days to prepare.
1. Watch the Town Hall Discussion
The CFPB is hosting a debt collection town hall discussion on Wednesday at noon Eastern. The event will be live streamed on the CFPB’s website. The discussion will likely focus on the NPRM, so key stakeholders within your business should block off the time to watch the event.
2. Prepare to Comment
The NPRM’s release will be followed by a public comment period—this is the time for individual companies and the industry as a whole to be heard. Other than what Director Kathleen Kraninger included in her speech (that the rules will address call caps, email, and text), we don’t yet know what the rules will cover so it’s too early to start drafting comments. However, now is the perfect time to prepare a group of team members within your organization designated for this purpose. This team’s job should be to review the NPRM in its entirety and determine the rules’ impact on your organization. Depending on the impact, the team should then make a decision about whether or not to submit a comment and, if the latter is decided, begin drafting it.
While many industry associations and groups will be commenting on the NPRM, it’s important that debt collectors submit their own company’s comments as well. Not only is this your company’s opportunity to have its voice heard, it will also prevent the industry's comments from being drowned out by those of consumer groups (who are likely motivating their base to comment individually as well).
3. Get Your Compliance and Change Management Systems Ready
The NPRM is not the final rule, so there is no need for a mad dash to make changes just yet. However, depending on the rules’ substance, your company might need to make some significant changes. The best time to get ready for such changes is before they become required.
So how can your company’s change management system or team prepare for this?
- Ensure you have a systemic, documented process for how changes occur at your company.
- Since the rules will likely impact your company across the board, ensure you have stakeholders from all major departments present. For example, since we know call caps are coming, it’s important to have representatives from the operations and IT departments as part of the discussion.
- Have a team dedicated to combing through the NPRM and picking out the actions required so that each change can be itemized and documented. Since the rules have been in-progress for so many years, it’s unlikely that they will change dramatically from what is contained in the NPRM. Having a list of all requirements from the NPRM will make it simple, once the final rules are released, to cross off any deleted requirements and add any new ones. This team could also be a great source of information for the group responsible for your company’s comments as discussed in the section above.
4. Open Dialogue with Creditor Clients
While the NPRM is not the final rule, its release is a great opportunity to open a dialogue with your creditor clients to determine how these rules will impact the business and the creditors’ current requirements. Some creditors are well-informed and are following the debt collection rulemaking process closely, while others may be reyling on their third-party agencies and firms to be the experts. In both situations, clear communication before the rules are finalized is the best approach to avoid confusion and address differences in interpretation.
5. Most Importantly: Don’t Panic
As mentioned several times throughout this article, the NPRM is not the final rule. There is no need to go into overdrive and make massive changes as soon as the NPRM is released. What is needed—and will be of the most benefit—is the submission of well-thought-out, persuasive comments on the NPRM’s requirements and impact. The best way to do this is after a thoughtful, thorough review of the requirements’ impact on your business. The comment period for the NPRM is likely to be somewhere between 30 to 90 days, which leaves enough time to review the proposed rules calmly.