Source: United States Senator Kevin Cramer (R-ND)
WASHINGTON – U.S. Senator Kevin Cramer (R-ND), member of the Senate Banking Committee, joined Senator John Boozman (R-AR) in an effort to fight back against the Biden Administration’s attempt to pick small business winners and losers based on social factors.
The Small LENDER Act would block the Consumer Financial Protection Bureau (CFPB) from requiring community banks and lenders to collect and report social data on small businesses seeking loans. Instead of focusing on creditworthiness, the CFPB proposal would require lenders to solicit the race, gender, and ethnicity of small business borrowers and divulge it to federal bureaucrats in Washington. The move would prioritize these social factors, place additional red tape before lenders and make it harder for small businesses to access capital.
“Small businesses are the backbone of the American economy, but overly burdensome regulations from the Biden Administration and the Consumer Financial Protection Bureau threaten their access to credit. Our bill protects community banks and small lenders from additional costly regulations so they can meet the needs of the communities they serve,” said Senator Cramer.
“Small businesses are experiencing historic inflation rates, skyrocketing energy costs and supply chain disruptions as a result of the Biden administration’s policies. They are the backbone of the economy, and the CFPB’s proposal would add yet another burden by driving up the cost of capital. The Small LENDER Act encourages investment and ensures access to financing by preventing the agency from imposing an unfunded mandate on many community banks and small lenders,” said Senator Boozman.
The Small LENDER Act would:
- Exempt the smallest lenders by establishing a 500-covered transaction threshold;
- Provide small business relief by codifying a small business as one with $1 million or less in revenue; and
- Give lenders and small businesses more time to comply by establishing a three-year implementation schedule plus a two-year grace period.
Senators Cramer and Boozman were joined in introducing the bill by Senators Cynthia Lummis (R-WY) and Thom Tillis (R-NC).
Companion legislation was introduced in the U.S. House of Representatives by Congressman French Hill (R-AR).
The Small LENDER Act is supported by the Independent Community Bankers Association, the Credit Union National Association, the National Association of Federally-Insured Credit Unions, and the Equipment Leasing and Finance Association.
Click here for bill text.