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Sept 28 -- The Consumer Financial Protection Bureau (Bureau or CFPB) invites public comments to OMB by November 17, 2023 on a new information collection titled “Making Ends Meet Survey.” [Comments due 30 days after submission to OMB on October 18, 2023.]

The Dodd-Frank Wall Street Reform and Consumer Protection Act charges the Consumer Financial Protection Bureau with researching, analyzing, and reporting on topics relating to the CFPB's mission including consumer behavior, consumer awareness, and developments in markets for consumer financial products and services. To improve its understanding of how consumers engage with financial markets, the CFPB has successfully used surveys under its “Making Ends Meet” program. The “Making Ends Meet” program has also used the CFPB's Consumer Credit Information Panel (CCIP) as a frame to survey people about their experiences in consumer credit markets. The CFPB seeks approval for two yearly surveys under the Making Ends Meet program. These surveys solicit information on the consumer's experience related to household financial shocks, particularly shocks related to the economic effects of the COVID–19 pandemic, how households respond to those shocks, and the role of savings to help provide a financial buffer.

The first survey will be a follow-up to respondents from the CFPB's 2023 “Making Ends Meet” survey to better understand household financial experiences dealing with medical debt as well as consumers' interactions with various financial products. The second survey will go to a new sample of consumers from the CCIP and will address a several topics of interest to the CFPB possibly including the impact of natural disasters and other environmental events, credit shopping behavior, additional follow-up regarding debt collection, and the assessment of various fees throughout the financial services ecosystem.

Making Ends Meet surveys use the Consumer Credit Information Panel (CCIP), a proprietary random sample of de-identified credit records from one of the three major national credit reporting agencies, as a frame to survey people about their experiences in consumer credit markets.  This survey will also solicit information on the sampled consumer’s experience related to use of credit products contained in the CCIP as well as credit products that are not reported to credit reporting agencies.  Because the CCIP includes extensive historical credit-record information, surveys based off the CCIP will be especially helpful in understanding how households’ finances evolve due to economic shifts, changes in financial products and service, and consumers’ decisions.  The size of the CCIP and auxiliary information it includes, such as estimated demographic information, will help in identifying specific subpopulations for whom obtaining or using a specific financial product may warrant deeper future research.

Surveys that are directly linked to the CCIP are invaluable to this research agenda because the CCIP provides extensive longitudinal data on households’ liabilities and their credit score—a key measure of creditworthiness as perceived by lenders.  Surveys connected to the CCIP can provide information that are not available in credit records such as perceptions, behaviors, experiences, income, expenditures, economic shocks, and ownership and values of various assets (e.g. homes, savings accounts, etc.)

This information collection will improve the CFPB’s understanding of consumer financial markets, including, potentially, mortgage loans, car loans, student loans, installment loans, small dollar loans, and credit, debit, and prepaid cards, as well as markets for emerging financial products.  In addition, this information collection and research may be related to the CFPB’s mission regarding financial education, including financial planning behaviors, including savings, spending, and investing behavior.

The specific purpose of these two annual surveys is to advance the CFPB’s research into household balance sheets allowing the CFPB to inform and advance scientific understanding of consumer credit markets and household finance.  This research program aims to help the CFPB and stakeholders better understand how consumer experiences, perceptions, and decisions affect households’ balance sheets over time.  These data collections will allow the CFPB to understand how markets are evolving and to discover problems or concerns, providing opportunity for further study with more targeted research projects.

Surveys that are directly linked to the consumer credit panel (CCP) are invaluable to this research agenda because the CCP provides extensive longitudinal data on households’ liabilities and their credit score—a key measure of creditworthiness as perceived by lenders.  Surveys connected to the CCP can provide information that are not available in credit records such as perceptions, behaviors, experiences, income, expenditures, economic shocks, and ownership and values of various assets (e.g. homes, savings accounts).
 
The main research question for this information collection relates to the persistence of external shocks (e.g. an unemployment episode) on the dynamics of household balance sheets.  Very little is known about the persistence of these effects over time or how they interact with financial services and other strategies consumers use to cope with financial difficulties because the necessary data is scarce.  Here are some example questions that the CFPB seeks to answer:
 
-- Are consumers able to use credit effectively to smooth these types of shocks and recover relatively quickly? Or does the income disruption have ramifications that affect the household’s balance sheet for years, or a lifetime?
-- How can financial markets affect these outcomes?
-- How do households use savings to avoid having a shock become a larger financial problem?

The information will also serve as the basis for the CFPB’s Making Ends Meet report, which the CFPB produces and which serves as an annual gauge of consumers’ financial wellbeing and balance sheet conditions.  The information collected will also provide information on topics of interest to researchers who study consumer finances especially areas where existing data cannot answer key research questions. For example, recent work using the Making Ends Meet survey has provided unprecedented detail on the use of Buy-Now-Pay-Later products.

Where appropriate, the Office of Research plans to disseminate the results of this research and make versions of the data and analysis available publicly.  Therefore, the data to be collected under this clearance will not only improve the CFPB’s understanding of consumer financial markets, but it will also increase the knowledge available to other policymakers and researchers.  Publication of our research will increase transparency toward the public about the work that the CFPB is doing.

CFPB Making Ends Meet Survey 2022: https://www.consumerfinance.gov/data-research/research-reports/insights-from-making-ends-meet-survey-2022/
CFPB submission to OMB: https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202309-3170-001 Click on IC List for questionnaire, View Supporting Statement for technical documentation. Submit comments through this site.
FRN: https://www.federalregister.gov/d/2023-21273
 
For AEA members wishing to submit comments, "A Primer on How to Respond to Calls for Comment on Federal Data Collections" is available at https://www.aeaweb.org/content/file?id=5806

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