Financial trade groups, including the Credit Union National Association and the National Association of Federally-Insured Credit Unions, are asking the Consumer Financial Protection Bureau for an additional 45 days to review and comment on the agency’s 913-page proposed small business credit reporting rule.
“While we appreciate the opportunity to comment, we also believe that such a complex and important subject merits sufficient time to provide feedback,” the groups wrote last week in a letter to CFPB Director Rohit Chopra.
They are asking the agency to allow comments to be filed up to Feb. 20, 2022.
In September, the CFPB issued its proposed rule requiring financial institutions, including credit unions, to report information about their small business lending, in an attempt to root out discriminatory practices. Lenders that made at least 25 credit transactions in each of the past two years would be required to report demographic information about their small business credit applicants, under the rule.
If an applicant does not provide ethnicity, race, or sex information for at least one principal business owner, the bureau is proposing that the financial institution collect at least one principal owner’s race and ethnicity—but not sex—via visual observation.
The agency set a 90-day comment period on the proposal.
The agency’s plan would require financial institutions to collect and report more than 21 data elements from credit applications. The groups said that community banks and credit unions do not have the staff that can read and respond to the proposal within the 90-day period.
“As you recognize, small financial institutions play a pivotal role supporting small businesses and their communities, and much of the information the Bureau needs to move forward prudently lies with them,” the groups wrote. “The present timeline does not give these institutions time to communicate through their normal advocacy channels, let alone directly to the bureau as you have encouraged them to do.”