The Consumer Financial Protection Bureau (CFPB) has taken steps to revise the small business loan data collection rule (1071 Rule) after continued opposition from financial institutions. The 1071 Rule, stemming from Section 1071 of the Dodd-Frank Act, mandates financial institutions to collect and report loan application data from small businesses. This mandate has faced significant resistance across the financial services industry. On April 3, 2025, the CFPB supported the Revenue-Based Finance Coalition's motion to delay the rule’s compliance date. The agency informed the U.S. District Court for the Southern District of Florida that its new leadership had instructed staff to initiate a new rulemaking process. The CFPB further stated that it anticipated issuing a Notice of Proposed Rulemaking as soon as reasonably possible.
Additionally, the CFPB emphasized that the forthcoming rulemaking process could resolve or address the pending litigation concerning the rule. This move aligns with the agency's stance in other legal cases, such as one filed by the Texas Bankers Association, where the CFPB consented to extend the compliance deadlines for plaintiffs. The CFPB’s willingness to delay compliance deadlines for all affected entities, coupled with its acknowledgment that new rulemaking may address concerns, indicates that upcoming changes to the 1071 Rule could reflect feedback from the financial services industry. While the CFPB has not provided a clear timeline for the proposed changes, its actions suggest that the 1071 Rule’s future remains uncertain. Furthermore, in April 2025, the House Financial Services Committee advanced legislation aimed at repealing the rule, which would remove the statutory provision underpinning it. This renewed effort signals that revisions to the rule could come soon.
