Regulation B is the CFPB rule implementing ECOA. It sets the operational requirements for credit application data collection, adverse action notices, record retention, and — through Section 1071 — small-business lending data reporting.
Regulation B (12 CFR Part 1002) is the operational counterpart to ECOA, just as Regulation Z is to TILA. While ECOA establishes the legal prohibition on credit discrimination, Reg B defines the mechanics: when lenders must send adverse action notices, what information they must collect on applications, how long records must be kept, and what credit evaluation criteria are permissible. For small-business lenders, the most significant Reg B development in recent years is the Section 1071 amendment. The CFPB's 1071 rulemaking updated Reg B to require covered lenders to collect data on small-business applications — including the race, sex, and ethnicity of principal owners — and report that data to the CFPB annually. The goal is to surface lending disparities that might indicate discriminatory patterns. For business owners interacting with the credit system, Reg B is most practically relevant through adverse action notices. If you're denied a business loan from a covered lender, Reg B governs your right to a written explanation. It also prohibits lenders from asking for information about marital status or spouse's income in most business credit contexts.
No, but they work together. ECOA (15 USC 1691) is the federal statute — the law passed by Congress. Regulation B (12 CFR Part 1002) is the CFPB rule that implements ECOA, setting the specific operational requirements. Think of ECOA as the 'what' and Reg B as the 'how.'
For commercial credit, the lender must provide an adverse action notice within a reasonable time (or 30 days). The notice must state the specific reasons for the adverse action or inform the applicant they have the right to request the reasons within 60 days. Unlike consumer credit, for business credit the applicant must specifically request the reason statement.
The CFPB finalized its Section 1071 small-business lending data rule in 2023. It requires lenders who originate above threshold volumes of small-business credit to collect and report applicant demographic data. Implementation is phased by lender size, starting with the largest lenders first. Check the CFPB website for current compliance deadlines.