Small Business Loan Data Collection

Impact

The intent of Section 1071 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) is to facilitate enforcement of fair lending laws and enable communities, governmental entities, and creditors to identify business and community development needs and opportunities of women-owned, minority-owned, and small businesses. Credit unions strongly support the goal of this provision and seek to provide all members with opportunities such as the ability to start or own a small business when it is possible to do so. However, credit unions are concerned about the likely unintended consequences of having to collect additional data, which because of their diverse and unique fields of membership would not align with practices for collecting data by the large Wall Street banks and other financial service providers.  

Where We Stand

Credit unions, by their very mission, seek to provide safe and affordable products and services to consumers in need. While CUNA strongly supports the intent of Section 1071 and the Equal Credit Opportunity Act, there are serious concerns about unintended consequences that could result from a rule requiring additional data collection.  

Requiring the collection of more data could do more harm than good by creating additional regulatory barriers for credit unions seeking to provide member business loans. Comparable data collection requirements as suggested by the CFPB in this RFI have proven to be extremely burdensome to credit unions and will likely impact credit union participation in the small business lending market.  CUNA has been engaged with the CFPB on this issue for some time and will continue to urge the CFPB to tailor any data collection for credit unions.   

 

What We've Told Lawmakers & Regulators
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