If you've ever had any opinion whatsoever on the future of the industry, you'll want to respond to the Treasury Department's RFI. The idea that government interest in the rise of alternative finance is purely focused on the consumer side is a misnomer. The Treasury clearly mentions B2B transactions and small businesses.
The regulatory framework going forward is not contingent on Congress to pass new laws. On the contrary, the Consumer Financial Protection Bureau (CFPB) possesses lawmaking authority despite being part of the executive branch of government. And what's worse, the Dodd-Frank Act extended them a level of influence in commercial transactions through an expansion of the Equal Credit Opportunity Act.
The law's outline as written, threatens subjective underwriting, many lead generation tactics, and all funders and brokers who lack the technology to comply with the data collection requirements. The writers may have had their hearts in the right place but they put it together five years ago, before anyone was really familiar with the rise of alternative finance.
So whether you're a broker, funder, platform, or even a third party tied into the ecosystem, you should respond to this inquiry. Read the full Treasury document and instructions here.
- Sean Murray