CFPB Rescinds Nonbank Registration Regulation

The CFPB, on Oct. 29, 2025, issued a final rule rescinding a previous rule that governed the registration of nonbanks that are subject to public agency and court orders, collection and submission of registration information by such persons, and public release of the collected information as appropriate.

As previously reported by Holland & Knight, the CFPB has been considering the Registry of Nonbank Covered Persons Subject to Certain Agency and Court Orders Rule (NBR Rule), which was adopted by the Biden-era CFPB on July 8, 2024. Under the NBR Rule, the CFPB had authority to initiate enforcement or supervision actions with regard to entities that do not submit registration information in accordance with stated deadlines. In compiling and publishing a registry of covered nonbank entities, the NBR Rule is intended to "support Bureau functions by monitoring for risks to consumers in the offering or provision of consumer financial products or services, … facilitate the supervision" of qualifying entities, and "assess and detect risks to consumers." However, on April 11, 2025, the CFPB announced that it would not prioritize such enforcement or supervision actions, instead electing to "continue to focus its enforcement and supervision activities on pressing threats to consumers."

The CFPB subsequently published a proposal to rescind the NBR Rule on May 14, 2025, as previously reported by Holland & Knight. The agency reinforced its concern that the "significant regulatory burden imposed by the NBR Rule" is not sufficiently justified by the benefits to consumers, as "Congress has authorized multiple other Federal and State agencies to enforce Federal consumer financial laws." The CFPB, therefore, took the position that such congressional authorization renders the NBR Rule duplicative and unnecessary.

After further analyzing the NBR Rule and considering "among other things, consistency with any prudential, market, or systemic objectives" of the CFPB and other government agencies, the CFPB has now elected to rescind the NBR Rule. Though the CFPB has authority to prescribe rules "as may be necessary or appropriate to enable the [CFPB] to administer and carry out the purposes and objectives of the Federal consumer financial laws," it also has authority to rescind such rules. Particularly when the balance of equities does not support the agency's increased supervision and oversight, the CFPB has the discretion to utilize the rulemaking process and eliminate rules that it considers to be unnecessary. In line with that discretion, and due to the agency's "concerns that the costs the rule imposes on regulated entities, which may be passed on to consumers, are not justified by the speculative and unquantified benefits to consumers," the CFPB has elected to rescind all key components of the NBR Rule.

Rescission was generally supported by the 16 comments the CFPB received in response to its request for public comment. Several commenters specifically noted the CFPB's similarly situated concern that the NBR Rule was unnecessary, duplicative and burdensome. While some commenters opposed rescission based on concerns for necessary transparency, the CFPB proceeded with rescission as a means of tackling "regulatory overreach," which has become a key initiative for the Trump-era CFPB.

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