The Department of Defense has turned down a request from financial trade groups and members of Congress to delay implementation of Military Lending Act rules governing credit cards.
As a result, the rules went into effect on Tuesday.
The financial trade groups, including CUNA, NAFCU and banking trade groups, had in June asked that those rules be delayed for one year so the Pentagon could clarify how they would be implemented.
"Confusion and these inconsistencies make it likely that service members and their families might not have full access to safe and responsible credit options," the groups said, in the letter
The groups said that extending the MLA regulation to cover credit card accounts under an open-end consumer credit "has resulted in a set of requirements that are unworkable for the industry and will restrict issuers' ability to make this essential product fully available to servicemembers and their families."
More recently, a bipartisan group of House members asked for the rules to be delayed since, they said, the DoD has not issued sufficient guidance on how financial institutions can comply with the rules.
The Pentagon did not buy those arguments.
"I do not find a compelling reason to delay the current credit card compliance date," Virginia Penrod, chief of staff in the office of the Undersecretary of Defense, wrote in a letter to the trade groups.
She said that DoD had worked with the trade groups before the final rules were issued in an effort to "ease compliance requirements and allow for continued innovation and competitiveness in and among credit products and providers."
She said that Pentagon officials are planning to provide additional guidance to financial institutions.
She added, "the current MLA regulation serves to improve the lives of service members and their families while supporting military readiness."
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