This bill would eliminate a federal requirement that banks and lenders collect and report detailed information about small business loans. Currently, under a rule created by the Dodd-Frank financial reform law, financial institutions have to track data like the race and gender of small business owners, the loan amount, and whether the loan was approved or denied. The government uses this information to monitor whether lenders are treating small business owners fairly and equally.

The bill's supporters argue that gathering and reporting all this data is expensive and burdensome, especially for smaller banks and credit unions that don't have large compliance departments. They claim these costs make it harder for small banks to lend money to small businesses because they have to spend resources on paperwork instead of lending. By repealing this requirement, they believe banks will have fewer obstacles and can focus more on actually lending to small business owners.

However, critics would likely point out that this data collection helps regulators spot discrimination in lending—for example, if certain groups of small business owners are being denied loans at higher rates than others. Removing this requirement means there would be less oversight of whether lenders are treating all small business owners fairly, regardless of their background.

1071 Repeal to Protect Small Business Lending Act

Kennedy, John

1071 Repeal to Protect Small Business Lending ActThis bill repeals the statute that requires financial institutions to collect data regarding applications for women-owned, minority-owned, or small business loans. Currently, financial institutions must collect and report to the Consumer Financial Protection Bureau information on (1) how many applications were received; (2) the disposition of each application; (3) the type of loan; (4) the amount applied for; (5) the amount approved; and (6) each applicant’s census tract, revenue, race, sex, and ethnicity.