The CFPB issued a proposed rule regarding Small Business Lending Data Collection under Section 1071 of the Dodd-Frank Act.
Based on the proposal, an institution will be subject to the rule if it originated at least 25 covered credit transactions to small businesses in each of the prior two years. A “small business” would be one with no more than $5 million in gross annual revenues in the prior fiscal year.
Covered institutions would need to collect and report certain data for small business credit applications. This includes information specific to the credit request, such as the purpose and amount; information specific to the business, such as the number of workers and time in business; and information on the demographics of the principal owners or ownership status. Data would also need to be reported annually to the CFPB. Institutions must limit access to the demographic information, as well as minority or women-owned status, unless it’s not feasible to do so and notice is provided.
Learn more about the impact and find additional resources to navigate Small Business Lending Data Collection in relationship to section 1071 of the Dodd Frank Act by clicking here.
The CFPB provided a Summary and Chart of the data points. There is only a 90-day comment period following the proposal’s publication in the Federal Register.
We will be covering this in the lending portion of our Virtual Lending Compliance Conference Series and will also be presenting a Small Business Lending Data Collection webinar on September 29th 2021.
Published
2021/09/07