The CFPB’s revised 1071 Rule redefines “small business” as any firm with gross annual revenue under $1 million, cut from $5 million in the 2023 version. That single change trims the data universe, though the Bureau argues it better aligns with SBA size standards and reduces compliance burden without sacrificing coverage.
Published in the Federal Register on May 1 and effective June 30, 2026, the rule sets compliance for January 1, 2028. The origination threshold for covered lenders jumps from 100 to 1,000 transactions per year. The Bureau says the new threshold still captures 92 to 93 percent of small business loan volume, down from 94 to 95 percent under the 2023 version.
Three product categories exit the rule entirely: merchant cash advances, agricultural lending, and loans of $1,000 or less. On MCAs, the Bureau was candid: many smaller providers “may lack the infrastructure” to manage compliance. That’s a frank admission that the 2023 rule reached into markets it didn’t fully understand.
The demographic data changes are where the political footprint is clearest. The rule removes LGBTQI+ status collection, replaces the free-form sex/gender field with a Male/Female binary aligned with the Defending Women Executive Order, and drops all disaggregated race and ethnicity categories. Anti-discouragement provisions are gone too. Taken together, the 2028 dataset will answer narrower fair lending questions than the 2023 rule intended. The CFPB frames this as an HMDA-style incremental build: that framework took decades to reach useful density.
The Monticello Banking Co. v. CFPB challenge to the 2023 rule is stayed until June 30. A Texas Bankers Association status report is due June 3 with the Fifth Circuit.
— Marcus Webb