LEGAL UPDATE: On September 14, 2023, a federal judge in the US District Court for the Eastern District of Kentucky issued an injunction prohibiting the CFPB from enforcing the Small Business Lending (1071) rule. Unlike the prior injunction issued by a Texas federal district court, this injunction applies nation-wide and to any party subject to the 1071 rule, not just the parties to the litigation. Unlike the Texas injunction, however, the Kentucky injunction does not require the CFPB to revise the effective dates of the 1071 rule in the event that the CFPB prevails in the underlying litigation. Finastra continues to work toward delivering its 1071 solution, and we are actively monitoring for further legal developments and will provide additional updates on any significant future developments. Know more.
Section 1071 of the Dodd-Frank Actrequired the Consumer Financial Protection Bureau (CFPB) to incorporate new small business data collection requirements as part of the federal Equal Credit Opportunity Act (ECOA).
On March 30, 2023, the CFPB issued its long awaited final small business lending rule ushering in new wide‑ranging impacts on commercial small business lenders.
Compliance with the new small business lending rule will be required as early as October 1, 2024 for larger institutions, with compliance required later for smaller institutions.
Get started understanding what the new small business lending rule will require and how Finastra has your back.
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