WASHINGTON–Facing considerable pushback from the courts—including legal action from credit unions– Congress and the administration, the CFPB intends to issue a new rule on small business lending data collection under section 1071 of the Dodd-Frank Act.

In a legal response last week, the CFPB said it has “been assessing the Final Rule and the issues that this case presents to determine the CFPB’s position. CFPB’s new leadership has directed staff to initiate a new Section 1071 rulemaking.”

According to the Bureau, it plans on issuing a Notice of Proposed Rulemaking as “expeditiously as reasonably possible.”

Grateful for ‘Revisiting’

“We’re grateful the CFPB intends to revisit this rule, as the current final rule threatens to increase complexity and costs for credit unions simply trying to provide access to credit tailored to the needs of small businesses,” America’s Credit Unions Chief Advocacy Officer Carrie Hunt said in a statement. “We hope that, under new leadership, the CFPB will scale back this rule to solely what’s required in statute and let credit unions continue to work in partnership with small businesses all around the country.”

As the CU Daily has previously reported, America’s Credit Unions, Cornerstone League, and Rally Credit Union challenged the rule after it was finalized, which was cited in the filing from the CFPB. That lawsuit is currently on appeal before the Fifth Circuit Court of Appeals. 

Motion Filed

The group filed  a motion for summary judgement in March of 2024, which was ultimately turned down by the courts.

The House Financial Services Committee passed a bill last week  that would repeal the rule. That bill has the backing of credit unions.