2025-00377NoticeWallet

Policy Statement on Compliance Assistance Sandbox Approvals

Published Date: 1/10/2025

Notice

Summary

Starting January 10, 2025, the Consumer Financial Protection Bureau (CFPB) is rolling out a new policy for its Compliance Assistance Sandbox program. This program helps companies test fresh financial products that truly solve consumer problems without giving unfair advantages to any one business. It’s all about encouraging fair competition and smart innovation, with no extra costs for consumers or taxpayers.

Analyzed Economic Effects

6 provisions identified: 2 benefits, 3 costs, 1 mixed.

Must prove an unmet consumer need

If you apply for a Compliance Assistance Sandbox Approval, you must show your product solves an unmet consumer need rather than being a minor tweak or exploiting legal gaps. The CFPB says a claim that approval would just increase access to an applicant's existing product is insufficient.

No single-firm approvals or marketing claims

The CFPB will not grant a CAS Approval on a topic for a single firm and will reach out to competitors to invite them to apply; recipients also may not market or promote that they received an Approval. These measures are intended to avoid giving a first-mover advantage or creating the false impression the CFPB endorses a product.

Five‑year enforcement bar for applicants

Companies that were the subject of an enforcement action involving violations of federal consumer financial law in the last 5 years, or that are subject to a pending enforcement investigation, generally will not be considered for a CAS Approval. The CFPB will generally not consider applications from such firms.

Reporting, oversight, and consumer compensation rules

Approvals (CASTs) can require recipients to report metrics like complaint patterns and default rates, consent to CFPB supervisory exams, and, where appropriate, commit to compensating consumers for CFPA‑actionable substantial injury. These terms are part of the CAST that recipients sign.

Two‑year approvals, modification, and termination rules

CFPB CASTs generally expire in 2 years, recipients may apply for extensions (application should be submitted no later than 90 days before expiration), modification decisions aim to be made within 30 days after a complete request, and the CFPB may allow up to a six‑month wind‑down before termination unless consumer injury requires immediate action. Approvals are automatically rescinded if the recipient materially changes the product without obtaining an amended Approval.

Public posting and 60‑day comment period for applications

The CFPB will post CAS applications to an open docket on regulations.gov and accept public comment for 60 days; it intends to publish approvals and denials on its website consistent with confidentiality rules. The CFPB will adhere to its Disclosure Rule and FOIA exemptions when deciding what information to make public.

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Key Dates

Published Date
1/10/2025

Department and Agencies

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