In Congress, something that helps small companies usually comes with bipartisan help. However part 1071 of Dodd-Frank is somewhat sophisticated.
It’s one other part of Dodd-Frank that’s nonetheless within the strategy of being carried out (the opposite being 1033). And lots of in Congress don’t prefer it. So what’s Part 1071?
At first look, it appears fairly innocuous. Part 1071 merely requires small enterprise lenders to report how a lot they’re lending to minority, ladies and LGBTQ-owned small companies. Nevertheless, these elements can’t affect lending selections.
Each the Home and Senate handed a invoice that may take away Part 1071 however President Biden vetoed the measure.
Now, the rule is about to enter impact in 2024 and the primary compliance deadline is October 1, 2024. Though there’s a preliminary injunction to the rule based mostly on a lawsuit difficult its validity.
Banks don’t like this new requirement in any respect as it’s going to require new programs and an excessive amount of expense.
No matter all of this, small companies nonetheless want extra entry to capital. And minorities want it greater than most.
Editor’s word: That is our final e-newsletter of 2023. Thanks for being a part of our group. We want to want all our readers a contented and stress-free vacation season and we’ll see you once more on January 2, 2024.
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