WASHINGTON — Rep. Roger Williams, R-Texas, chairman of the House Small Business Committee, is introducing a bill today to repeal the section of Dodd-Frank that requires financial companies to collect and report small-business lending data to the Consumer Financial Protection Bureau.
Section 1071 of Dodd-Frank requires the Consumer Financial Protection Bureau to make a small business lending data collection rule. After considerable delay, the
"Small businesses are the backbone of the American economy, and it is crucial that they can access affordable credit to support and grow our communities," Williams said in a statement. "My bill seeks to eliminate costly regulatory burdens on financial institutions, ensuring greater access to credit for small businesses. It is time to Make Small Businesses Great Again and put an end to this overly broad, burdensome, and difficult to implement rule-making."
Republican lawmakers Bill Huizenga of Michigan, Mike Flood of Nebraska, Ann Wagner of Missouri and Frank Lucas of Oklahoma joined Williams in cosponsoring the bill.
The bill has the support of banking groups, including the Independent Community Bankers of America, the American Bankers Association and the Mortgage Bankers Association, as well as other groups like the Texas Bankers Association and the National Federation of Independent Business.
The CFPB final rule on 1071 was meant to make lenders begin collecting data on how many applicants are approved or denied small-business loans, including the cost of credit as well as geographic and demographic details about the borrowers. The rule was slated to go into effect in 2024 but was immediately met with criticism and
The Texas Bankers Association, the American Bankers Association and Rio Bank, an $814.7 million-asset private bank in McAllen, Texas, challenged the rule, arguing that they should not have to comply with the rule because the 5th Circuit Court of Appeals
A federal judge later granted a preliminary injunction to the banking groups until after the Supreme Court's decision on whether the funding of the CFPB was constitutional, which the high court ruled in
Congress has also challenged the CFPB's small-business data-collection rule. The House
Williams helped lead that effort as well.
"The CFPB's rule is overly broad," Williams said on the House floor at the time. "It will require lenders to collect massive amounts of data whenever a small-business owner applies for credit. Most of the information is unnecessary to make a fair, equitable, safe and sound loan. Requiring lenders to provide this information infringes on small-business owners' right to privacy about their personal and business information when applying for credit."
The Senate
