Bill Proposed to Amend CFPB’S Small Business Data Collection Rule

A simple bill has been introduced in the House of Representatives to amend the CFPB’s small business data collection rules. The 888-page rulebook has been undergoing an internal reconfiguration by the CFPB itself but in this instance members of Congress are attempting to make minor changes through legislation.

These proposed changes are as follows:
• Amend the definition of small business to mean a business that does $1 million a year in revenue versus the $5 million defined in the last iteration of the rules.

• Amend covered financial institutions as ones that do at least 500 credit transactions a year versus the 100 transaction threshold defined in the last iteration of the rules.

This bill is called the “Small Lenders Exempt from New Data and Excessive Reporting Act.”

The small business lending data collection rules drafted by the CFPB have been the subject of controversy since 2010 when the law requiring the agency collect small business loan data was first passed. Sixteen years later there has still been much disagreement as to what was actually intended to be collected, from whom it is to be collected from, the manner in which this collection takes place, and what can be done with the data itself once it’s in the agency’s hands. The agency is likely to release an amended version of the rules sometime this year.