Oct. 1, 2021–WASHINGTON, D.C.— The Consumer Financial Protection Bureau (CFPB) at the U.S. Treasury Department has set a notice of proposed rulemaking for the implementation of Section 1071 of the Dodd-Frank Act.
Section 1071 would require banks and financial institutions to report and make transparent certain small business loan data, including racial data.
Despite the need for policy reform in access to capital for underserved small business owners, there is currently no standardized way to collect and examine demographic data for small business loans. The U.S. Black Chambers, Inc. (USBC) applauds the CFPB for undertaking this critical initiative to better understand the role of demographic barriers to small business access to capital.
Ron Busby, President and CEO of the U.S. Black Chambers Inc. said the following about the implementation of Section 1071: “The implementation of Section 1071 of the Dodd-Frank Act will enable policymakers at the state and federal levels to better understand the racial and demographic barriers that many small businesses in our community face when seeking capital. To first tackle racial inequity, we must better understand the data and the triggers behind it at a systemic level.
“The ongoing, disparate economic impact of the COVID-19 pandemic on Black-owned businesses has laid bare the consequences of inadequate data when it comes to understanding and targeting relief to our community. The availability of data on small business lending will greatly increase our ability to make access to capital more equitable for Black businesses. USBC looks forward to seeing this law through to implementation.”