PROTECTED Act

S 2352, the PROTECTED Act, modifies the Equal Credit Opportunity Act to change how financial institutions collect data for small business loans. It requires institutions to inform applicants they aren't obligated to provide certain financial details (like revenue), that their response won't affect credit decisions, and that the data is collected for federal reporting. The bill prohibits institutions from compiling data through visual observation or other indirect methods and bars using applicant response rates to assess compliance. It directly affects financial institutions originating at least 2,500 small business loans annually (with $1 billion+ in assets) and small businesses with under $1 million in annual revenue. The law includes a 2-year safe harbor period before enforcement begins.