Reuters, February 26, 2020: US consumer watchdog agrees to implement minority-lending protections after lawsuit
The U.S. Consumer Financial Protection Bureau (CFPB) has agreed to enforce data-collection requirements that aim to guard against discriminatory lending practices after being sued by a Washington-based advocacy group, the group said on Wednesday.
Democracy Forward sued the agency in May 2019 alleging it had flouted laws introduced following the 2007-2009 financial crisis that require it to collect and disclose data on lending to women-owned, minority-owned and small businesses.
Data gathered by the nonpartisan association the National Community Reinvestment Coalition in 2014 identified major barriers to women- and minority-owned small businesses lending.
Women-owned firms had a loan approval rate that was 15% to 20% lower than that of their male counterparts, while 23% of nonminority-owned firms received loans compared with 17% of minority-owned firms, the study found. Better data would make it easier to identify the obstacles such groups face when trying to access credit, said Democracy Forward.
