As part of ongoing efforts from the Trump administration to streamline regulatory efforts, the Consumer Financial Protection Bureau (CFPB) is proposing changes to Larger Market Participant thresholds, many of which currently conflict with the Small Business Administration (SBA) size standards.
Background
On Aug. 8, 2025, the CFPB published four proposed rulemakings regarding how the CFPB defines larger participants in the automobile financing, consumer debt collection, consumer reporting and international money transfer markets. This rulemaking would alter the CFPB’s supervisory authority over nonbank entities operating in each of these markets. In each of these rulemakings, the CFPB seeks to raise the threshold for what larger participants are defined as in each of these markets.
The CFPB is pursing this rulemaking while undergoing a transformative period highlighted by eliminating unnecessary and duplicative regulations, modifying enforcement priorities and reducing funding.
Defining Larger Participants in the Automobile Financing Market
This rulemaking seeks to adjust the threshold for what defines a larger participant in the automobile financing market. Currently, a larger participant in this market is defined as a nonbank covered person that has at least 10,000 aggregate annual originations. This definition comes from the June 30, 2015, Automobile Financing Larger Participant Rule and defines aggregate originations as credit granted for the purchase of an automobile, refinancing of an automobile, automobile leases and purchases of any of the previous obligations. Under the current rule, 63 entities that compose 94% of estimated market activity are considered larger participants. The CFPB is seeking to raise the threshold for larger participants because they believe the current threshold imposes a regulatory burden on nonbank entities in the automobile financing market and that if the threshold is raised, the CFPB believes they would be able to better use their resources in investigating these nonbank entities.
The CFPB has proposed three potential new thresholds for what defines larger participants in this market. The first, and lowest, threshold is 300,000 aggregate annual originations. Under this threshold, 17 nonbank entities that cover 79% of originations would be considered larger participants. The next threshold the CFPB is considering is 550,000 aggregate annual originations, which would qualify 11 nonbank entities and 66% of originations as large participants. The largest increase in the threshold would raise it to 1,050,000 aggregate annual originations and be comprised of five nonbank entities that make up 42% of aggregate annual originations.
Defining Larger Participants in the Consumer Debt Collection Market
This rulemaking seeks to raise the threshold for what defines a larger participant in the consumer debt collection market. The Consumer Debt Collection Larger Participant Rule, published on Oct. 31, 2012, defines a larger participant in this market as a nonbank covered person that has more than $10 million in annual receipts resulting from consumer debt collection. This threshold was chosen because at this number the CFPB believed it would be able to effectively identify market risks and assess compliance. When the rule was initially published, this threshold applied to about 4% of debt collectors or 175 of the 4,500 debt collecting entities. Another factor that contributed to the CFPB initially selecting this threshold was that at the time the rule was finalized, the SBA defined a debt collection agency as a small business if its annual receipts were less than $7 million. Today, the SBA size standard has increased to $19.5 million, which means there are a number of collection agencies that are characterized as a small business by the SBA but a large participant by the CFPB.
The CFPB has proposed three potential new thresholds for what defines a larger participant in the consumer debt collection market. The first increase would be raising the annual receipts threshold to $25 million, which would categorize approximately 100 to 125 debt collection agencies as larger participants. Raising the threshold to $50 million would categorize between 60 and 90 debt collection agencies as larger participants. Raising the threshold to $100 million would categorize between 11 and 64 debt collection agencies as larger participants.
Defining Larger Participants in Consumer Reporting Markets
This rulemaking seeks to raise the threshold for what defines larger participants in the consumer reporting market. The Consumer Reporting Larger Participant Rule, published on July 20, 2012, defines a larger participant in the consumer reporting market as a nonbank covered person that has at least $7 million in annual receipts. When this rule was published, the SBA small-business threshold for consumer reporting entities was $7 million, and the CFPB intended to match this number with the large participant threshold. The SBA threshold is currently $41 million, and the CFPB has stated that the $7 million large participant threshold is significantly too low for it to be able to effectively regulate the consumer reporting market. In this rulemaking the CFPB proposes that the large participant threshold be raised to $41 million, which would leave at least six larger participants in the market.
Defining Larger Participants in International Money Transfer Markets
This rulemaking seeks to raise the threshold for what defines larger participants in the international money transfer market. The International Money Transfer Larger Participant Rule, published on Sept. 9, 2014, defines a larger participant in the international money transfer market as a nonbank covered person that has at least 1 million aggregate annual international money transfers. Under this rule, over 98% of all international money transfers are covered, and the CFPB believes that this threshold creates a regulatory burden on many small and mid-sized international money transfer entities. Furthermore, the largest eight entities conduct 77% of international money transfers.
The CFPB has proposed three new potential thresholds for what defines a large participant in the international money transfer market. The first proposed threshold is 10 million aggregate annual international money transfers, which would lower the current number of entities that fall within the threshold from 28 to 15, and this group would compose 94% of international money transfers. The next proposed threshold is 30 million, which would cover eight entities and 77% of international money transfers. The largest increase would raise the threshold to 50 million aggregate annual international money transfers. Under this threshold, four nonbank entities comprising 61% of international money transfers would fall under this categorization.
Looking Ahead
Each proposed rule is now open for public comment, with all submissions due by Sept. 22, 45 days after their publication. Brownstein’s team can assist with advocacy efforts related to these proposals.
