Thursday, May 11, 2017

CFPB Seeks Information on the Small Business Lending Market

The Consumer Financial Protection Bureau (CFPB) has issued a request for information on various aspects of the market for small business loans.

Section 1071 of the Dodd-Frank Act calls for the CFPB to collect data on women-owned, minority-owned and small businesses to help identify needs and opportunities in the small business lending market and to facilitate enforcement of fair lending laws.

The CFPB is seeking information in five broad categories: the definition of a small business; what data points the bureau should require to be collected; what lenders should be encompassed by the data collection; what kinds of financial products and credit are offered to small businesses; and privacy concerns related to the data collection. Comments are due 60 days after the filing is published in the Federal Register.

The CFPB also released a preliminary report providing the agency's perspective on the market for lending to small, minority-owned and woman-owned firms and gaps in its understanding of the small business lending market.

The report discussed the role of credit unions, along with other lenders, in financing small businesses. For example, the report cites a Federal Reserve Survey that found "11 percent of all surveyed employer firms and 13 percent of non-employer firms applied for financing at a credit union" with 46 percent of employer businesses and 33 percent of non-employer businesses being approved for credit.

Read the request or information.

Read the CFPB report.

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