According to a recent survey, financial institution executives’ top regulatory compliance concern is the final rule from the Consumer Financial Protection Bureau (CFPB) on data collection for small business loan applications. The regulation, expected to be finalized in weeks, outranked BSA/AML rules, beneficial ownership requirements, and current expected credit loss (CECL) obligations.
This post provides answers to some of the frequently asked questions (FAQs) about what types of data financial institutions will have to collect from small business loan applications, as well as details to help banks and credit unions prepare for the CFPB rule to take effect.
Abrigo has been closely tracking the development of the CFPB’s requirements to collect and report small business loan data, and its product and compliance experts attend all relevant webinars and calls with the CFPB. Abrigo will add functionality to our commercial loan origination system to support upcoming compliance requirements once the final decisions have been made on the CFPB side.
In addition, Abrigo has and will continue to update resources to help banks and credit unions understand and prepare for what is expected to represent the most significant effort of small business lending data collection and reporting for financial institutions in nearly 50 years. A CFPB 1071 resource page for lenders, content, and educational webinars will walk lenders through requirements and preparations. Abrigo consultants are also available to work with financial institutions to ensure the smooth adoption of the requirements.