The CFPB has finalized a one-year delay for compliance with its small-business lending rule under Section 1071 of the Dodd-Frank Act, giving credit unions and community lenders more time to prepare their reporting systems but drawing criticism from consumer advocates.
The rule, first issued in 2023, requires financial institutions to collect and report detailed data on small-business loan applications, including demographic information on applicants. The goal is to improve transparency in business lending and strengthen fair-lending enforcement.
Under the new schedule, compliance dates now begin July 1, 2026 for the largest lenders (2,500+ covered originations), Jan. 1, 2027 for mid-sized lenders (500–2,499), and Oct. 1, 2027 for smaller lenders (100–499). First annual data submissions will be due between June 2027 and June 2028 depending on the tier.
The CFPB said institutions can use loan origination data from any of three years, 2022–23, 2023–24 or 2024–25, to determine their tier, and may voluntarily begin collecting demographic data up to a year early to test systems.
The extension came amid ongoing litigation that had created confusion over timelines. By aligning deadlines across the industry, the CFPB said the rule provides “certainty for all institutions” while it reconsiders certain provisions in a forthcoming rulemaking.
The CFPB estimated the delay saves lenders $313 million in compliance costs.
The rule’s long-term impact on small-business lending remains at the center of the debate as lenders balance operational readiness with regulatory expectations.
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