During the COVID-19 pandemic, the Federal Reserve and other agencies issued updated principles for banks to consider when offering responsible small-dollar loans. Successful programs incorporate repayment safeguards and seek to provide outcomes that enhance borrowers' financial capabilities.
As loan markets continue to evolve, well-designed small-dollar loan products remain an important resource for consumers, helping to encourage positive credit practices and transition into additional financial products. I will conclude with a key element of the Federal Reserve's community engagement to broaden access to financial services so that more Americans can participate in the broader economy.