On October 1, the Consumer Financial Protection Bureau (CFPB) complied with statutory reporting requirements by releasing the Fair Lending Report of the Consumer Financial Protection Bureau for 2025, the CFPB’s summary of its fair lending work during 2025. The report boasts of a sweeping reorientation of the CFPB’s priorities from the prior administration. Over the reporting period and into 2026, the CFPB has, according to the report, taken the following actions:
- Abandoned disparate impact as a supervision and enforcement tool. The CFPB closed all open exams and investigations that relied on it, and finalized an amendment to Regulation B removing the “effects test” (the evaluation of whether a creditor’s facially neutral lending policy nevertheless disproportionately harmed a protected group). The CFPB thereby affirmed its view that the Equal Credit Opportunity Act (ECOA) does not authorize disparate impact liability.
- Stopped supporting special purpose credit programs (SPCPs) that use race, color, national origin, or sex as eligibility criteria. Specifically, the CFPB prohibited for-profit creditors from using those characteristics in SPCP eligibility determinations.
- Prioritized the prevention of debanking. In accordance with its stated purpose of stopping the denial of access to financial services based on political or religious beliefs, the CFPB confirmed that its guidance, regulations, and manuals do not reference reputation risk, convened a public meeting of its Consumer Advisory Board focused in part on unlawful debanking, and is working with the Department of Justice’s (DOJ) Equal Access to Banking Task Force, to address debanking issues more broadly.
- Reduced regulatory overreach. The CFPB narrowed the scope of the covered institutions and transactions regulated under the Small Business Lending Rule (Section 1071 of the Dodd-Frank Act) by raising the loan origination threshold for covered institutions from 100 to 1,000 loans annually, reducing the small business gross annual revenue threshold from $5 million to $1 million, and cutting back the data points it collects. The report projects cost savings of nearly $100 million one-time and between $166 million and $181 million annually.
Enforcement efforts during the reporting period were remarkably low. The CFPB stated that it did not initiate supervisory activities or cite any fair lending violations, nor did it refer any matters to the DOJ pursuant to its mandatory ECOA referral obligations. The report also documents the CFPB’s reversal of several prior enforcement actions, including vacating consent orders with various lenders and terminating actions the report says targeted companies for protected political speech. The report asserts that the CFPB’s change in focus reduced unnecessary compliance burdens and resulted in substantial cost savings for impacted institutions.
Financial services companies should be aware that the 2025 report reflects a dramatically changed landscape for fair lending compliance. Institutions that structured programs around disparate impact analysis, operated SPCPs with race or sex-based eligibility criteria, or have open ECOA-related matters with the CFPB may need to reassess their approach in light of the CFPB’s new priorities and amended regulations. Financial institutions across sectors should also ensure their account closure and denial practices, and related adverse action notices, are robust given the CFPB’s focus on debanking.