ABA Offers Feedback to CFPB Ahead of 1071 Rulemaking

In a comment letter to the Consumer Financial Protection Bureau today, the American Bankers Association offered feedback on a recent outline of the proposals the bureau is considering to implement Section 1071 of the Dodd-Frank Act, which concerns the collection of credit application data for women-owned, minority and small businesses.

To help mitigate the cost of compliance for small entities, ABA urged the bureau to: calibrate the definition of “financial institution” to avoid undue burden on small institutions; retain its preliminary decision to consider a simple and clear definition of “small business” based on gross annual revenues; and retain a flexible approach on timing of data collection. ABA warned that “a one-size fits all approach to data collection would be very unworkable given the range of products and business models covered.”

ABA also urged the CFPB to only require reporting of mandatory data elements and to consider redacting 1071 data to protect small business’ privacy and supported a minimum two-year implementation period for the rule once it is finalized.