On June 18, the Consumer Financial Protection Bureau (CFPB) published a notice in the Federal Register that significantly delays the compliance deadlines for the rule implementing Section 1071 of the Dodd-Frank Act. For those tracking this issue closely — and many in the equipment finance industry certainly are — the extension might appear, on the surface, to be just another delay. But make no mistake: this is not just a case of kicking the can down the road. This delay signals something bigger, and perhaps more consequential, is afoot.

To quickly recap: Section 1071 requires financial institutions to collect and report data on small business lending, including demographic information on credit applicants. The final rule issued in March 2023 by then-Director Rohit Chopra spanned 888 pages and introduced a sweeping new data collection regime. It was met with considerable concern from across the financial services spectrum — not just because of its scope, but because of its one-size-fits-all approach to an incredibly diverse marketplace.

Now, with a change in administration and leadership at the CFPB, the agency has hit the brakes. The interim final rule grants covered institutions almost a full year of additional time to comply. On paper, it’s an extension. In practice, it’s a reset. Buried in the Federal Register notice is a key signal: the CFPB intends to repropose the rule.

Yes, you read that right — repropose.

That alone should get everyone’s attention. Reproposal isn’t something agencies do lightly. It’s an acknowledgment, whether explicitly stated or not, that the rule as written is no longer viable. The 1071 rule drafted under Chopra’s leadership is unlikely to survive in its current form. The Bureau now under Trump administration leadership seems poised to take a very different approach — one that is likely more targeted, more pragmatic, and hopefully, more in touch with the real-world operations of small business lenders.

To be clear, some of the language in the interim final rule still references voluntary compliance. That may be designed to give the appearance that the existing rule is still on life support. But let’s not kid ourselves. A rule that’s paused, under reconsideration, and staring down a full-scale reproposal is not a rule that’s going to come back in the same clothes.

This development comes as no surprise to us at the Equipment Leasing & Finance Association. We’ve been advocating for a more reasonable approach to 1071 for years — one that accounts for the unique structures and business models of independent and captive finance companies, not just regulated banks. The notion that the same data collection burden could apply across the board, regardless of institution type or lending model, was always flawed. This pause gives policymakers a chance to correct course.

That said, the road ahead is still uncertain. There’s no new proposed rule yet, and no timeline for when one might arrive. The existing text of the now-delayed rule remains on the books — at least for now — and some institutions may feel pressure to prepare "just in case." That’s understandable, but probably premature. With the political winds shifting, and the Bureau itself publicly acknowledging the need to start over, the smarter move might be to wait for further clarity before investing heavily in systems to comply with a rule that, practically speaking, no longer exists in any meaningful way.

In the meantime, ELFA remains fully engaged — with the CFPB, with Congress, and with the broader coalition of financial services stakeholders who are pushing for a more rational approach. We’re making the case that compliance frameworks must be proportional, risk-based, and tailored to the diverse players in the commercial finance space. And we’ll continue to update our members as developments unfold.

For now, we advise a measured posture. Stay informed. Stay engaged. But don’t overreact. The CFPB has just pulled the emergency brake on Section 1071, and while we don’t know exactly where the train is heading next, it’s definitely not continuing on the same track.