Cordray already serves as interim chairman of the Consumer Financial Protection Bureau by recess appointment.
Senate Republicans had opposed Cordray, as well as the concept of the consumer bureau.
Sen. Elizabeth Warren, D-Mass., first conceived of the idea of a consumer protection bureau. Obama considered naming her to lead the bureau, but her nomination would likely have run into deep opposition on Capitol Hill.
The nomination suggests that President Obama feels that Cordray’s nomination will pass Senate muster under reformed filibuster rules.