Section 1071 covered financial institutions will be required to report the “time in business” and while there is some flexibility in reporting this information, there are some complexities.
For example, the Rule does not mandate any particular definition which means an institution could look to the amount of time since the specific business was created or perhaps even an owner’s years of experience. Either measurement could work but there are some requirements surrounding the use of such options:
- If a financial institution determines how long the business has existed (by asking the applicant or otherwise), that is what is reported. However, if the financial institution only determines how many years of experience the owner(s) has, that is what is reported. If the financial institution determines how many years a business has been in existence AND the number of years of experience among the owners, the time in business should be reported based on the number of years the business has existed.
- If a financial institution does not determine time in business using a specific number of years, the institution may report whether or not the business has been in existence for at least two years.
Published 2026/11/06
