The Independent Community Bankers of America (ICBA) has announced its support for a new legislative proposal aimed at overturning the Consumer Financial Protection Bureau’s (CFPB) data collection and reporting requirements under Section 1071 of the Dodd-Frank Act. The proposed legislation, known as the 1071 Repeal to Protect Small Business Lending Act, was introduced by House Small Business Committee Chairman Roger Williams from Texas.
“ICBA and the nation’s community banks applaud Chairman Williams for introducing much-needed legislation to overturn intrusive and overly burdensome data collection and reporting requirements for small-business loans,” stated ICBA President and CEO Rebeca Romero Rainey. She added that the act would stop "misguided data collection requirements" that could hinder community banks' ability to serve small businesses effectively.
The CFPB rule mandates lenders to gather and report detailed information on credit applicants, including personal details such as race, sex, ethnicity of principal owners, and gross annual revenue. Although the CFPB can exempt certain financial institutions from these standards or limit mandatory data points, it has chosen to apply this rule broadly across community banks. These banks are responsible for 60% of small-business loans in the United States.
Previously, during the 118th Congress, Chairman Williams sponsored legislation supported by ICBA under the Congressional Review Act to repeal this rule. Despite receiving strong bipartisan backing in both chambers of Congress, it was vetoed by then-President Joe Biden. With the Congressional Review Act no longer an option for repealing Section 1071, ICBA is now supporting Williams’ new bill which must pass through both houses of Congress.
ICBA urges all congressional members to back this repeal effort to ensure that community banks can continue their role in supporting small businesses across the country.
The Independent Community Bankers of America focuses on creating an environment where community banks can thrive through advocacy, education, and innovation. By leveraging their relationship-based business model, these banks aim to foster economic growth within their communities.
For further details about ICBA's initiatives and mission, visit their website at icba.org.