Senator Bernie Moreno (R-Ohio) and Representative Warren Davidson (R-Ohio) have introduced the American Lending Fairness Act of 2026. The bill aims to prevent states from using opt-outs to enforce their own interest rate caps on loans issued by out-of-state chartered banks and credit unions.
“When states use opt-outs to slap their own interest rate caps on out-of-state lenders, it is hardworking Americans who feel the pain,” said Senator Moreno. “I am committed to restoring clear national standards and protecting access to credit for all Americans, regardless of where they live.”
“Federal law should not pick winners and losers based on a bank’s charter,” said Rep. Davidson. “The American Lending Fairness Act restores decades-long precedent, protects consumers’ right to shop for interest rates across state lines, and ensures they benefit from real competition.”
The legislation seeks to reinstate federal preemption of state interest rate laws for state-chartered banks and credit unions engaged in interstate lending. It maintains the authority of states over institutions chartered within their borders while allowing these institutions to offer loans across state lines under uniform rules, similar to national banks.
The proposal responds directly to a 2025 Tenth Circuit decision in National Association of Industrial Bankers v. Weiser, which permitted states such as Colorado to apply local caps on loans made by out-of-state lenders.
Several industry groups expressed support for the measure. Rob Nichols, President and CEO of the American Bankers Association (ABA), stated: “We applaud Sen. Moreno and Rep. Davidson for introducing this important legislation to preserve the competitive parity that is such an essential principle of our nation’s dual banking system. We appreciate their efforts to ensure state-chartered banks can compete on a level playing field with national banks, and we urge the House and Senate to move this bill forward.”
Michael Adelman, President and CEO of the Ohio Bankers League (OBL), commented: “A bank’s home state should never become a regulatory cage. Modernizing DIDMCA is essential to protecting the dual banking system and ensuring Ohio’s state-chartered banks can compete fairly in a digital-first economy. Without this fix, we shrink the marketplace, limit consumer choice, and drive up costs for borrowers. This is a common-sense update that strengthens competition and protects communities across Ohio and the country.”
The Ohio Credit Union League also voiced its approval: “We are grateful to Senator Moreno and Congressman Davidson for introducing this important legislation that will cut costs and increase flexibility for credit unions to best serve their members… We look forward to working closely with Senator Moreno and Congressman Davidson to get this bill signed into law.”
Frank Pignanelli, Executive Director of the National Association of Industrial Bankers (NAIB), added: “Senator Moreno deserves enormous credit for stepping up to ensure that consumers and small businesses continue to have access to affordable, regulated credit—no matter where they live… The bill preserves the essential foundation of interstate banking and restores much-needed clarity and common sense.”
Celia Winslow, President & CEO of American Financial Services Association (AFSA), said: “AFSA greatly appreciates and supports Senator Moreno’s ‘American Lending Fairness Act of 2026,’ which would continue the level playing field between state- and nationally chartered banks that has existed for decades, ensuring consumers have access to a wider set of credit options.”
Penny Lee from Financial Technology Association (FTA) remarked: “We applaud Senator Moreno and Congressman Davidson for their leadership in introducing the bicameral American Lending Fairness Act of 2026… This legislation will give consumers and small businesses more access to credit, enhance product offerings, and ensure competitive pricing by providing consistent rules for nationwide lending.”
Andrew Duke from Online Lenders Alliance (OLA) argued that modern proponents pushing states’ opt-out rights are trying “to weaponize” provisions intended by Congress in 1980 through DIDMCA: “The American Lending Fairness Act of 2026 would add clarity needed…and we appreciate you all introducing this important legislation.”
Jason Stverak at Defense Credit Union Council (DCUC) noted: “Senator Moreno and Congressman Davidson’s American Lending Fairness Act is about restoring legal certainty … For decades, interest rate exportation has provided a stable framework that allows credit unions [to] serve members across state lines—especially military families who move often due [to] permanent change-of-station orders.”
Scott Simpson at America’s Credit Unions (ACU) supported streamlining requirements so resources could focus more on serving families’ financial needs rather than navigating complex regulations.
Phil Goldfeder at American Fintech Council emphasized maintaining equal footing between community banks through DIDMCA’s framework; he warned against recent attempts by some states seeking greater autonomy over interstate lending practices.
Parris Sanz at WebBank highlighted support for legislative efforts ensuring regulatory parity between federally- or state-chartered institutions as critical toward keeping markets fair nationwide.
