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The CFPB’s revised Section 1071 small-business lending rule was finalized May 1 (91 FR 23530), took effect June 30, and sets a single compliance date of January 1, 2028. The structural change is the threshold. A lender is covered only if it originated at least 1,000 covered credit transactions in each of two consecutive calendar years. That is ten times the 2023 rule’s 100-loan trigger.
The rule’s reach narrows in kind as well as count. Farm Credit System lenders are excluded from coverage outright, and merchant cash advances, agricultural lending, and small-dollar transactions drop out of the covered-transaction definition. The discretionary data points are removed from the collection. They were application method, application recipient, denial reasons, pricing information, and number of workers.
What survives the revision
Despite the tenfold threshold increase, the Bureau estimates the revised rule still captures 92 to 93 percent of small-business loan volume at depository institutions, versus roughly 94 to 95 percent under the 2023 rule. Coverage concentrates in the highest-volume lenders rather than disappearing.
| 2023 final rule | 2026 revised rule | |
|---|---|---|
| Coverage threshold | 100 covered originations | 1,000 in each of 2 consecutive years |
| Farm Credit System | Covered | Excluded |
| MCAs · ag · small-dollar | In scope | Carved out |
| Discretionary data points | Collected | Removed |
| Depository loan volume covered | ~94–95% | ~92–93% |
The two-consecutive-year lookback means coverage is decided before compliance begins. The 2026 and 2027 origination counts are the test, and 2026 is half over.
The quiet urgency
A 2028 compliance date reads like runway, but the lookback inverts it. Whether you are a covered financial institution on January 1, 2028 depends on origination counts you are generating right now. A community bank near the 1,000-loan line needs a defensible count of covered transactions for 2026 before it can even decide whether to build. The count has to follow the rule’s definition instead of your core system’s loan codes.
- Count 2026 originations against the rule’s covered-transaction definition now, including the exclusions, and document the methodology.
- If you are near the threshold, brief the board on the build-versus-monitor decision this quarter instead of waiting for 2027.
- Keep fair-lending fundamentals independent of 1071 coverage. ECOA risk does not switch off below 1,000 loans.
Zovos runs your loan tape against the revised covered-transaction definition and produces the documented count. The coverage question is then settled by evidence instead of an estimate.
This is for information only and is not legal advice. Confirm your obligations against the final rule text and counsel before acting.