On September 1, 2021, the Consumer Financial Protection Bureau (CFPB) issued a notice of proposed rulemaking (NPRM) amending Regulation B to implement the small business lending data collection rules in Section 1071 of the Dodd-Frank Act.
Section 1071 amended the Equal Credit Opportunity Act (ECOA) to require covered financial institutions to collect and report data about credit applications made by women-owned, minority-owned, and small businesses, including but not limited to: the purpose of the loan, amount applied for and approved, actions taken, and the race, sex, and ethnicity of the business owners [see 15 U.S.C. § 1691c-2].
The CFPB is proposing detailed instructions for collection and reporting, including data points and a sample data collection form. The NPRM includes new definitions for “covered financial institution”, “small business”, and “covered credit transactions.” The CFPB is also proposing that collected data be made available to the public on an annual basis. A summary of the NPRM can be found here.
Industry stakeholders can submit comments on the NPRM at www.Regulations.gov for up to 90 days after the date it is published in the Federal Register.
Compliance Systems continues to monitor this issue for developments and any impact to our solution.