Washington, DC – Today, 19 national consumer and civil rights groups led by the National Community Reinvestment Coalition (NCRC) sent letters to members of the U.S. Senate asking them to sign on to Senator Cory Booker’s letter urging the Consumer Financial Protection Bureau (CFPB) to issue rulemaking on small business loan data. Section 1071 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 requires the CFPB to improve the quality and availability of small business lending data, in particular the race and gender of the owner of the small business, the revenue of the small business, and the action taken on the loan (approval/rejection). The CFPB still has not taken action on the rulemaking.
“In 2010, wanting to ensure that small businesses have greater access to lending, Congress required banks to report small business lending by size of business and gender and race of the business owners,” said NCRC’s President and CEO John Taylor. “This will be of immense value to all small business owners frustrated in their efforts to expand and grow their businesses and create jobs. Unfortunately, the CFPB has yet to issue the guidelines to implement Congress’s requirement.”
“Small businesses are vital to the continued recovery of our economy as important engines of job creation and neighborhood prosperity. Owning a small business can be a path for building wealth and joining the middle class. The existing data is clear: it is very difficult for small businesses, including those owned by women and people of color, to get access to small business loans from banks. This rule will serve to help ensure that all small businesses have the same opportunity to get bank loans as large corporations.”
“The CFPB must act now to issue requirements for the collection and release of this data, which is essential to shine light on the small business lending activities of financial institutions. We thank Senator Booker for taking the lead in calling for action.”
Last year, NCRC released “Recommendations to the Consumer Financial Protection Bureau for Implementing Section 1071 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010,” a white paper presenting recommendations on the collection and public availability of small business loan data from financial institutions.
Also last year, NCRC released “Small Business Lending Deserts and Oases,” a breakthrough report on small business lending trends in the United States and disparities in access to credit for small businesses.
The full letter from consumer and civil rights advocates and the list of signatures is here.