A group of Democratic senators expressed their general support for a rule proposed by the Consumer Financial Protection Bureau (CFPB) that supports access to credit for small businesses, especially those owned by women or minorities.
“For years, we have pushed the CFPB to move forward on this important rulemaking, and we are pleased that you are doing so now. It is the CFPB’s responsibility to carry out this mandate by issuing a final rule as soon as practicable,” the lawmakers wrote in a letter to CFPB Director Rohit Chopra.
The letter was signed by Sens. Ben Cardin (D-MD), chair of the Senate Committee on Small Business & Entrepreneurship; Sherrod Brown (D-OH) chair of the Banking, Housing, and Urban Affairs; Ron Wyden (D-OR), Dick Durbin (D-IL), and Cory Booker (D-NJ).
However, the lawmakers raised concerns about certain provisions in the proposed rule. The suggested several improvements so that the final rule can bring transparency to small business lending and support more women-owned, minority-owned, and small businesses.
“We believe there are a few areas that warrant further consideration. We understand the Bureau’s decision to exclude certain credit transactions from the “covered credit transactions” group subject to the proposed rule’s reporting requirements. The exclusions include factoring, leases, consumer-designated credit used for business purposes, and credit secured by certain investment properties. We are concerned that these exclusions would lead to a gap in our understanding of the small business lending marketplace and whether entities are in compliance with fair lending laws,” they wrote.
They also called the CFPB’s plan to propose a “balancing test” assessing the risks and benefits of public disclosure of certain data concerning.
“We understand the Bureau’s approach to consider industry concerns of reputational harm that weigh in favor of keeping some data private, but we wish to stress that there is a strong public interest in publishing as much data as practicable,” they added.