ICBA supports legislation to safeguard small business data

Rep. John Rose (R-Tenn.) introduced ICBA-supported legislation—the Bank Loan Privacy Act—aimed at reforming the CFPB’s Section 1071 small business reporting rule. The bill would require the CFPB to undergo a formal rulemaking process to determine how the small business loan data it collects will be shared and used.

Details: In many rural areas and specialized industries, loan-level data can be identifiable, raising concerns about borrower privacy. By requiring public notice and comment, this bill gives community banks, borrowers, and other stakeholders a seat at the table before any data is made public.

ICBA Support: In a letter to Rep. Rose, ICBA emphasized the importance of transparency, stating that “financial institutions as well as small business credit applicants should have a voice in this important determination and should understand what data will be made public before it is collected.”

Big Picture: The legislation is part of the House Financial Services Committee Chairman French Hill’s (R-Ark.) “Make Community Banking Great Again” initiative and was considered during the February 5 hearing, where ICBA President and CEO Rebeca Romero Rainey testified on behalf of ICBA.