The CFPB rule would increase paperwork requirements and could hinder small business lending
WASHINGTON, D.C. (Oct. 19, 2023) – The National Federation of Independent Business (NFIB), the nation’s leading small business advocacy organization, announced yesterday that it will consider S.J. Res. 32, the Congressional Review Act resolution of disapproval of the Consumer Financial Protection Bureau (CFPB) 1071 Small Business Lending Rule, an NFIB Key Vote for the 118th Congress. NFIB sent a letter to members of the United States Senate supporting the legislation.
“The CFPB 1071 rule would create onerous reporting requirements for both small business owners and the small financial institutions that lend to small businesses,” said Vice President of Federal Government Relations Kevin Kuhlman. “Small businesses are already inundated with federal paperwork when opening and running a business and applying for loans. They do not have the resources or staff to handle additional paperwork that this rule will require, and neither do the small financial institutions they overwhelmingly use. This rule would not only have a negative impact on credit unions and small banks nationwide but also has the potential to limit small businesses’ access to credit.”
According to NFIB’s latest banking survey, 67% of small businesses use a small or regional financial institution for their credit needs with an additional 17% using a medium-sized institution.
S.J. Res. 32 would repeal the Consumer Financial Protection Bureau’s (CFPB) small business lending rule, commonly referred to as the CFPB 1071 rule. The CFPB 1071 rule requires financial institutions to compile, maintain, and submit small business lending data to CFPB. NFIB filed comments opposing the reporting burdens of the CFPB 1071 Rule in 2017 and urging Congress to repeal the rule.