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Removing Barriers Blog

Push to Expedite Implementation of Section 1071 of Dodd-Frank Causes Concern
Posted August 21, 2015 by CUNA Advocacy

Recently, we became aware of an effort to get Members of Congress to sign a letter to the Consumer Financial Protection Bureau (CFPB) urging Director Cordray to expedite rulemaking related to Section 1071 of the Dodd-Frank Act, which directs the CFPB to compel financial institutions to collect and report additional data from small business borrowers. In light of significant data collection requirements already imposed on credit unions, CUNA has serious concerns about current efforts to expedite CFPB rulemaking that could increase the burden on credit unions and other small financial institutions.

Credit unions are profligate small business lenders. To the extent possible under the current member business lending cap, many credit unions contribute significantly to the availability of small business credit in their communities. However, increased regulatory burden in this space, including the imposition of additional reporting requirements, would only make it more difficult for credit unions to serve their small business members. 

While availability of data on small business lending is a very useful tool, similar data already exists through the Small Business Administration and other federal agencies. Requiring credit unions to file additional paperwork with the CFPB is not only burdensome, but would hamper the ability of credit unions to help small businesses prosper.  We hope Members of Congress will not sign the letter.

If you have questions regarding this issue, please do not hesitate to contact Robert Henson.