On April 21, the House Financial Services Committee voted 26-22 to advance H.R. 941, the “Small Lenders Exempt from New Data and Excessive Reporting” (LENDER) Act, introduced by Chairman French Hill (R-AR). The legislation, which the committee adopted via a substitute amendment, would amend the ECOA’s small business lending data collection requirements, as added by Section 1071 of the Dodd-Frank Act. Section 1071 requires financial institutions to collect and report data on credit applications from small businesses, including women-owned and minority-owned businesses.

H.R. 941, as amended, would: (i) exempt financial institutions that originated fewer than 2,500 small business credit transactions in each of the two prior calendar years or that have less than $10 billion in assets from the requirements; (ii) delay the compliance date until June 1, 2031, followed by a two-year safe harbor during which penalties may not be imposed; (iii) enshrine a small business loan applicant’s “right to refuse” by requiring lenders to inform applicants in writing that the data collection is required by the CFPB, that the applicant is not required to provide the information, and that the response will not affect the credit decision; (iv) require the CFPB to establish a plain-English model form for the notification; (v) narrow the statutory data points that financial institutions must collect by striking certain categories; (vi) prohibit the use of visual observation or any method other than applicant self-reporting to collect demographic information; (vii) prohibit the CFPB from using a financial institution’s low response rate as a factor in determining compliance; and (viii) redefine “small business” as an entity with gross annual revenues of $1 million or less, compared to the CFPB’s existing $5 million threshold.

As previously covered by InfoBytes, the CFPB’s 2023 implementing rule has been the subject of numerous legal challenges. Under the current administration, the Bureau has moved to revise the 2023 rule, issuing an NPRM in November 2025 (covered by InfoBytes here) proposing to narrow its scope, raise origination thresholds, reduce the number of data points that must be collected, and extend the compliance date to January 1, 2028. Most recently, on April 16, the Bureau submitted its final Section 1071 reconsideration rule to OMB for review (covered by InfoBytes here).