CFPB Proposes Changes To Section 1071 Rule

The CFPB is proposing major changes to its final rule that would require financial institutions to report information contained in loan applications submitted by small businesses, including women-owned and minority-owned small businesses.

The rule is better known as the "Section 1071 rule" after the section of the Dodd-Frank Act that required the CFPB to adopt it.

"The CFPB believes in retrospect that the approach it took in the 2023 final rule—a broad initial coverage of lenders, products, small businesses and data points—was not conducive to the long-term success of the data collection regime under section 1071," the bureau said, in the November 13 Federal Register.

"The CFPB now believes that a better, longer-term approach to advance the statutory purposes of section 1071 would be to commence the collection of data with a narrower scope to ensure its quality, and to limit, as much as possible, any disturbance of the provision of credit to small businesses,"