Better Consumer Protections and Fair Lending Practices (2023 Public Policy Update)

Better Consumer Protections and Fair Lending Practices

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OFN is acting to advance policies that promote transparency and ensure a fair and just financial landscape.

Throughout 2023, the OFN policy team has been working hard to advocate for and represent mission lenders on Capitol Hill and beyond. With Washington slowing down in August while Congress is in recess, we are taking stock of our progress. 

We are sharing a series of updates across all OFN federal policy priorities that advance our shared 2023 policy agenda.


OFN’s public policy team is working tirelessly to make sure consumer protection and fair lending are front and center. From reforms to landmark banking legislation to new rules that promote transparency, we are striving to build a fair and just financial ecosystem that’s good for our industry and the low-income communities they serve.  

Community Reinvestment Act Reform 

Community Reinvestment Act (CRA) regulations are being updated, and the Federal Reserve, along with the Office of the Comptroller of the Currency and the FDIC, are leading the way. They’ve been busy sifting through comments on the proposed rule from August 2022 and the final rule is in the works. It’s worth noting that the timeline had a few shifts due to staffing changes at the Federal Reserve and the recent regional banking crisis. 

OFN sat down with the new leader of these efforts, Federal Reserve Vice Chair Michael Barr, in late May, but he didn’t reveal any concrete release dates for the updated rule. 

New Transparency Measures for Small Business Lending 

Efforts to implement the Consumer Financial Protection Bureau’s long-awaited Section 1071 final rule hit a snag this summer when a federal court halted implementation of the rule until after the Supreme Court decides next year if the bureau’s funding structure is constitutional. OFN issued a statement expressing disappointment in this ruling.  

Section 1071 is one of the last remaining portions of the 2010 Dodd Frank Consumer Protection Act to be implemented. This data collection rule aims to boost transparency in small business lending by gathering demographic data from lenders about the credit applications they receive. Who’s in the spotlight? Small business lenders, including depository, online, nonbank, and CDFI lenders, will be required to report this data. The rule covers a wide range of products and includes merchant cash advances, but not factoring transactions. 

OFN has been waving the flag in support of this rule for years and will continue to support speedy implementation of the rule and other efforts to increase transparency in small business lending.

Truth in Lending Legislation for Small Business

In June, Representative Nydia Velazquez (D-NY) and Senator Robert Menendez (D-NJ) introduced the Small Business Financing Disclosure Act of 2023, extending the protections in the Truth in Lending Act to also include small business lending. The bill aims to protect small business owners from predatory lending, including misleading financing options that carry unfair terms and conditions.

It would require small business lenders to disclose key information, including the annual percentage rate (APR), when presenting financing options to small businesses, allowing them to have the necessary information to make financial decisions to grow and strengthen their businesses.  

OFN is working closely with coalition partners to advocate for the passage of the bill and is conducting direct outreach to congressional offices for their support. Want to join the effort? Visit our policy action center or contact our public policy team to discuss how you can get involved.


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