What dramatic cuts at the Consumer Financial Protection Bureau could mean for consumers

• The Trump administration moved to eliminate nearly 90% of staff at the Consumer Financial Protection Bureau.
• Legal challenges have prevented the Trump administration from shutting down the agency.
• Much of the work of the CFPB is now in doubt, experts say.

The Consumer Financial Protection Bureau was one of the of the Trump administration's attempts to dramatically reduce government spending. The bureau's work was first, and legal wrangling has continued since — which experts say has created an uncertain future for many CFPB efforts to protect consumers.  

In March, U.S. District Judge Amy Berman Jackson, and struck down targeting the bureau.

include declarations from CFPB staff stating that the firings will hobble the agency's ability to carry out tasks including , maintaining the consumer complaint database, and providing oversight and enforcement of mortgage and credit fair lending laws. 

Berman had scheduled a two-day hearing this week to help determine how many employees the agency needs to fulfill what it is required to do by law, but set that aside after on Monday upheld the suspension of the firings and scheduled arguments for May 16.

Mark Paoletta, acting chief legal officer of the CFPB, said in a court filing that the agency should be pared back to about a 200-person staff that can "fulfill its statutory duties and better aligns with the new leadership's priorities and management philosophy."

CFPB could be 'a vastly different animal' after cuts

The Trump administration's attempts to hobble to CFPB have about the agency's work for consumers and companies.

"The biggest challenge for innovators in financial services is the lack of clarity regarding the regulatory structures in which they have to abide and live," said Phil Goldfeder, CEO of the American Fintech Council, a standards-based trade association.

The CFPB was created in the aftermath of the financial crisis to establish a single agency responsible for enforcing consumer protection laws. It took over the supervision of consumer products from other bank regulators.

Those won't be picking up work the CFPB had been doing; it "just won't be done, or will be done much less," said Ian Katz, a managing director at Capital Alpha Partners, a policy research and political forecasting firm. 

In recent years, the CFPB has moved to cap bank overdraft fees, regulate payment apps and resolve consumer complaints. Now many of those efforts have been overturned or left in doubt. 

Under the Trump administration, the bureau has also been dropping lawsuits it previously filed. These include a case against National Collegiate Student Loan Trusts related to against private student loan borrowers, and a suit against Early Warning Services, JPMorgan Chase, Bank of America and Wells Fargo .

"There is a risk that this could go badly," said Katz. "It's not like they're taking a 20% cut of the personnel or a 15% and people say, 'Well, we might lose a few things here and there, but basically, we'll be OK.' It will be a vastly different animal and I think there's no avoiding that."

The CFPB did not respond to requests for comment.

Here's what experts anticipate could happen with some CFPB rules and programs.

Cap on bank overdraft fees

were scheduled to go into effect in October 2025, but Congress is now in the process of overturning the rule. Analysts expect banks to compete on keeping fees low. "I don't think they're going to immediately rush to raise them because of that competitive aspect," said Katz.

Payment app regulations

The CFPB had also moved to require that nonbank firms offering financial services like payments and wallet apps as banks. That is no longer going to happen — lawmakers voted to and President Donald Trump has indicated he will sign it.

As a result, "some payment apps are going to be supervised, and other ones won't," said Adam Rust, director of financial services for the Consumer Federation of America. 

Zelle, which is a bank product, will still fall under bank regulations, he said, but fintech firms such as Paypal, Venmo and Block's Cash App, will be "be able to evade that" oversight.

Consumer complaint database

It's also unclear how effective the CFPB will be at resolving consumer conflicts. The bureau is required by law to maintain a database of the consumer complaints and receives 25,000 complaints each week.

In 2023, the CFPB received more than 1.6 million consumer complaints, according to its.

The complaints are shared with the companies for a response, but consumer advocates worry without strong enforcement behind it, the database will lose its effectiveness.

"If there is a complaint and it's received, that doesn't mean that there will be a response, it will just potentially sit there in the queue," Rust said. "So if you're a consumer, you thought you did what you should, to seek someone to help find a remedy. But in fact, nothing's happening."

State attorneys general from 23 states have come out against the administration's efforts to defund the bureau. In a in February, they said that referrals of consumer complaints to the CFPB have been left in limbo, communications about enforcement investigations are lacking and direct inquires from the AG offices to the agency have gone unanswered. 

Correction: A court hearing regarding the Consumer Financial Protection Bureau has been vacated. An earlier version misstated its status.

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