HR 6732 — Small LENDER Act

Summary

Small Lenders Exempt from New Data and Excessive Reporting Act or the Small LENDER Act This bill exempts certain financial institutions and transactions from the Consumer Financial Protection Bureau (CFPB) reporting requirements with respect to data about small business credit applications. Under the bill, the requirements apply only to financial institutions that originate at least 500 credit transactions to small businesses in each of the preceding two years. The bill further defines small businesses as those with annual revenue of $1 million or less. Currently, the CFPB has proposed a rule that the requirements apply only to financial institutions that originate at least 25 annual credit transactions to small businesses in each of the preceding two years. The rule further defines small businesses as those with annual revenue of $5 million or less.

Bill Text

• Introduced Introduced in House Current html February 15, 2022

Compared against current U.S. Code AI-generated reading aid — verify against the official bill.

The bill amends existing provisions related to small business loan data collection, changing the compliance timeline and definitions for financial institutions and small businesses.

• 15 U.S.C. 1691c-2(g)

  "(4) Compliance.-- "(A) In general.--With respect to any rules or guidance issued under this subsection on or after the date of the enactment of this paragraph, the Bureau shall provide financial institutions not less than 3 years to comply with such rule or guidance. "(B) Safe harbor.--With respect to any rules or guidance issued under this subsection on or after the date of the enactment of this paragraph, upon the 3-year period described in subparagraph (A), the Bureau shall provide a 2-year safe harbor to all financial institutions during which the financial institutions are required to comply with the rule or guidance but not subject to any penalties."

  This change establishes a timeline for compliance and a safe harbor period for financial institutions regarding new rules or guidance.

• 15 U.S.C. 1691c-2(h)(1)

  "(1) Financial institution.-- The term `financial institution' means any partnership, company, corporation, association (incorporated or unincorporated), trust, estate, cooperative organization, or other entity that engages in any financial activity;" → "(1) Financial institution.--The term `financial institution' means-- "(A) any partnership, company, corporation, association (incorporated or unincorporated), trust, estate, cooperative organization, or other entity that engages in any financial activity; and "(B) in each of the two preceding calendar years, originated not less than 500 credit transactions for small businesses."

  This change specifies that a financial institution must originate at least 500 credit transactions for small businesses in the previous two years to be categorized as such.

• 15 U.S.C. 1691c-2(h)(2)

  "(2) Small business.-- The term `small business' means any entity with gross annual revenues of $1,000,000 or less in the most recently completed fiscal year." → "(2) Small business.--The term `small business' means any entity with gross annual revenues of $1,000,000 or less in the most recently completed fiscal year."

  This change does not alter the definition of small business but reaffirms it as pertaining to entities with gross annual revenues of $1,000,000 or less.

Action History

1. February 15, 2022

   Introduced in House

2. February 15, 2022

   Introduced in House

3. February 15, 2022

   Sponsor introductory remarks on measure. (CR H1323)

4. February 15, 2022

   Referred to the House Committee on Financial Services.

Sponsors

• J. French Hill · Primary

Subjects