Overview

• The proposal defines “risks to consumers” as conduct that presents a high likelihood of significant harm and is directly connected to a covered consumer financial product or service.
• The CFPB says the definition will bind the bureau in designation proceedings and that it expects to designate fewer nonbanks for supervision.
• The notice was published Tuesday in the Federal Register, and the public comment period runs through Sept. 25, 2025.
• The bureau estimates about 154,430 firms fall within its potential supervisory umbrella, has supervised fewer than 20 nonbanks to date, and pegs a typical exam at roughly $27,000 in labor costs.
• The move follows a federal appeals court ruling allowing Acting Director Russel Vought to cut up to 90% of staff, and industry reporting suggests looser oversight could encourage fintech expansion while KYC and AML duties remain.