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Published: January 2022

Ensure that banks equitably and justly invest in our communities

A coalition of 60 groups wrote a letter urging the Consumer Financial Protection Bureau (CFPB) to develop a strong rule requiring small business lenders to report on the race, ethnicity and gender of their borrowers, the neighborhoods where they lend, and what they charge for their loans. Members of the coalition have been advocating for small business data collection and transparency within the small business market for decades. Robust small business data collection through the Section 1071 rule will result in enhanced transparency, more responsible lending practices, targeted enforcement of fair lending laws, informed policymaking, healthier markets, and reduced racial and gender wealth gaps.

Lending discrimination harms not only impacted small businesses, but also our larger economy. More than 6 million jobs per year might have been added and $13 trillion in cumulative revenue gained if Black-owned firms had equitable access to credit over a 20-year period. Like the Home Mortgage Disclosure Act (HMDA) has been for home loan borrowers, access to critical data like race, ethnicity and gender will be a game-changer for small businesses owned by people of color and women. The CFPB’s rulemaking on Section 1071 of the Dodd-Frank Act, pertaining to small business lending data collection, is crucial in light of historic and continuing discrimination, unequal credit needs in communities, a lack of sufficient data to aid fair lending enforcement and sound policymaking, and Congressional inaction.

Lead Organization

California Reinvestment Coalition (CRC)

Other Organizations

Access Plus Capital | AmPac Business Capital | Asian Pacific Islander Small Business Program | ASIAN, Inc. 美亞輔鄰社 | Black Business Association | CAARMA Consumer Advocates Against Reverse Mortgage Abuse | California Capital Financial Development Corporation | California Community Economic Development Association | California Indian Legal Services | California Low-Income Consumer Coalition | California Reinvestment Coalition | CAMEO - California Association for Micro Enterprise Opportunity | CDC Small Business Finance | Community First Lending | Consumer Action | East Bay Housing Organizations (EBHO) | East LA Community Corporation | EPACANDO | Fair Housing Advocates of Northern California | Fair Housing Council of the San Fernando Valley | Faith and Community Empowerment | Financial Solutions 4 Life | Fresno Metro Black Chamber Commerce | Fresno Native American & Business Development Cent | Haven Neighborhood Services | Housing Rights Center | Housing Rights Committee of San Francisco | ICA Inclusive Action for the City | Initiative for a Competitive Inner City (ICIC) | Jakara Movement | JEDI | Koreatown Youth & Community Center | LA Forward | Los Angeles LDC | Main Street Alliance | Main Street Launch | Microenterprise Collaborative of Inland Southern California | Mission Community Loan Fund LLC | Mission Economic Development Agency | Montebello Housing Development Corporation | New Economics for Women | Nonprofit Finance Fund | Pacific Asian Consortium in Employment (PACE) | Pacific Coast Regional Small Business Development Corporation | Public Counsel | Public Good Law Center | Public Law Center | Reinvent South Stockton Coalition | Renaissance Entrepreneurship Center | Richmond Neighborhood Housing Services, Inc | San Francisco Housing Development Corporation | San Francisco Public Bank Coalition | Southern California Black Chamber of Commerce | The Central Valley Urban Institute | The Greenlining Institute | The Multicultural Real Estate Alliance for Urban Change | The Unity Council | Ventura Country Community Development Corporation | Working Solutions CDFI

More Information

For more information on discrimination in small business lending and what is being done to fight it, please visit CRC.

Download PDF

Ensure that banks equitably and justly invest in our communities   (CA-Comments-on-Section-1071_NPRM_Jan_5_2022.pdf)

 

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