On Oct. 29, 2025, the Consumer Financial Protection Bureau (CFPB) withdrew its proposed rule that would have required certain nonbank financial companies subject to its supervisory jurisdiction to submit annual reports about their use of terms and conditions that attempt to waive or limit consumer rights and protections.
As we previously outlined, the proposed rule—formally titled "Registry of Supervised Nonbanks that Use Form Contracts to Impose Terms and Conditions that Seek to Waive or Limit Consumer Legal Protections"—would have required supervised nonbanks to register annually with the CFPB and submit annual reports regarding their use of "covered terms and conditions." That would have included any term or condition in any consumer facing contract, including website terms of use, that:
- Limited the nonbank's liability by capping the amount of recovery or type of remedy;
- Limited the time period, forum, or venue in which a consumer may have filed a legal action;
- Agreed to arbitration;
- Waived any claim or legal protection that a consumer may otherwise pursue;
- Precluded a consumer from bringing or participating in a class action; or
- Limited a consumer's right to complain or post a review.
The CFPB proposed this registry because of concerns that "standard form contracts" had grown "ubiquitous" and were increasingly presented in a "click-through" format, emphasizing that the consumer has no "meaningful choice" whether to agree.1 In its withdrawal notice, the CFPB acknowledged industry concerns, stating that it agreed "with commenters that the burdens would have been unduly high and unwarranted, particularly in light of the speculative nature of the benefits."2 The CFPB also critiqued how the proposed rule would have captured terms that are lawful, and in some cases, encouraged.3
Takeaways
The CFPB's proposed rule would have required thousands of supervised nonbanks to either revise consumer-facing contracts to make them more consumer friendly or state to the CFPB (and the world) publicly that the nonbank uses terms and conditions that, in the view of some, pose risks to consumers.
While the withdrawal may be welcomed by supervised nonbanks, industry participants should remain alert for the possibility that state regulators may pursue similar registry requirements.
Footnotes
1. 88 Fed. Reg. 6906, 6908 (Feb. 1, 2023).
2. 90 Fed. Reg. 48787, 48787 (Oct. 29, 2025).
3. Id. at 48787 & n.3.
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