[Federal Register Volume 81, Number 24 (Friday, February 5, 2016)]
[Notices]
[Pages 6261-6263]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-02237]


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FEDERAL DEPOSIT INSURANCE CORPORATION

[3064-NEW]


Agency Information Collection Activities: Submission for OMB 
Review; Comment Request Re FDIC Small Business Lending Survey

AGENCY: Federal Deposit Insurance Corporation (FDIC).

ACTION: Notice and Request for Comment.

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SUMMARY: The FDIC, as part of its continuing effort to reduce paperwork 
and respondent burden, and as required by the Paperwork Reduction Act 
of 1995, invites the general public and other Federal agencies to 
comment on the survey collection instruments for a proposed new 
collection of information, a Small Business Lending Survey of banks 
that is proposed to be fielded in June 2016. On October 7, 2015, the 
FDIC published a notice in the Federal Register requesting comment for 
60 days on the proposed information collection (80 FR 60678). Two 
comments were received, and are discussed below. The FDIC hereby gives 
notice of its plan to submit to OMB a request to approve this new 
information collection, and again invites comment.

DATES: Comments must be submitted on or before March 7, 2016.

ADDRESSES: Interested parties are invited to submit written comments by 
any of the following methods. All comments should reference ``FDIC 
Small Business Lending Survey'':
     http://www.FDIC.gov/regulations/laws/federal/.
     Email: [email protected]. Include the name of the 
collection in the subject line of the message.
     Mail: Gary Kuiper (202.898.3877), Counsel, MB-3016, or 
Manuel Cabeza (202.898.3767), Counsel, MB-3105, Legal Division, Federal 
Deposit Insurance Corporation, 550 17th Street NW., Washington, DC 
20429.
     Hand Delivery: Comments may be hand-delivered to the guard 
station at the rear of the 550 17th Street Building (located on F 
Street), on business days between 7:00 a.m. and 5:00 p.m.

FOR FURTHER INFORMATION CONTACT: Interested members of the public may 
obtain a copy of the survey and related instructions by clicking on the 
link for the FDIC Small Business Lending Survey on the following Web 
page: http://www.fdic.gov/regulations/laws/federal/. Interested members 
of the public may also obtain additional information about the 
collection, including a paper copy of the proposed collection and 
related instructions, without charge, by contacting Gary Kuiper or 
Manuel Cabeza at the address or phone number identified above.

SUPPLEMENTARY INFORMATION: The FDIC proposes to establish the following 
collection of information:
    Title: FDIC Small Business Lending Survey
    OMB Number: New collection.
    Frequency of Response: Once.
    Affected Public: FDIC-insured depository institutions.
    Estimated Number of Respondents:
    1,500 respondents with assets less than $1 billion.
    500 respondents with assets of $1 billion or greater.
    Average time per response:
    3 hours per respondent with assets less than $1 billion.
    6 hours per respondent with assets of $1 billion or greater.
    Estimated Total Annual Burden:
    3 hours x 1,500 respondents = 4,500 hours
    6 hours x 500 respondents = 3,000 hours.
    Total: 7,500 hours.

General Description of Collection

    Small businesses are an important component of the U.S. economy. 
According to the Small Business Administration, small firms accounted 
for almost half of private-sector employment and 63 percent of net new 
jobs between mid-1993 and 2013.\i\Many small businesses have little or 
no direct access to capital markets and are thus reliant on bank 
financing. For banks, small business lending is an important way that 
they help meet their communities' needs, especially for the many banks 
that primarily focus on commercial rather than consumer lending.
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    \i\ https://www.sba.gov/sites/default/files/FAQ_March_2014_0.pdf, accessed Sep 15, 2015.
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    Due to the importance of small businesses to the U.S. economy and 
the importance of bank lending to small businesses, the proposed FDIC 
Small Business Lending Survey, which surveys banks, will provide 
important data to complement existing sources of data on small business 
lending. The proposed survey data will not duplicate existing sources 
of data and will provide additional insight into many aspects of small 
business lending.
    The FDIC Small Business Lending Survey, proposed to begin data 
collection in June 2016, is designed to yield heretofore unavailable 
nationally representative estimates on the volume and details of small 
business loans extended by FDIC-insured banks. In addition, the survey 
will provide new information on banks' perceived competition and market 
area for small business lending. The survey will yield nationally 
representative estimates of small business lending by banks of several 
different asset size categories and with different levels of urban or 
rural presence.
    In addition to the questions on small business lending, the new 
survey will include some questions related to consumer transaction 
accounts that are directly responsive to the mandate in Section 7 of 
the Federal Deposit Insurance Reform Conforming Amendments Act of 2005 
(``Reform Act'') (Pub. L. 109-173), which calls for the FDIC to conduct 
ongoing surveys ``on efforts by insured depository institutions to 
bring those individuals and families who have rarely, if ever, held a 
checking account, a savings account or other type of transaction or 
check cashing account at an insured depository institution (hereafter 
in this section referred to as the `unbanked') into the conventional 
finance system.'' Section 7 of the Reform Act further instructs the 
FDIC to consider several factors in its conduct of the surveys, 
including: ``What cultural, language and identification issues as well 
as transaction costs appear to most prevent `unbanked' individuals from 
establishing conventional accounts.''
    The consumer account-focused questions are designed to provide a 
factual basis for examining identification issues and transaction costs 
related to establishing mainstream transaction accounts at banks. These 
consumer account-focused questions have been added to the Small 
Business Lending Survey in lieu of fielding a separate second survey to 
respond to the Congressional mandate. The reason for the consolidation 
of these efforts is to reduce the burden on banks and increase the 
participation rate relative to fielding two separate surveys.

Comment Discussion

    On October 7, 2015 (80 FR 60678), the FDIC issued a request for 
comment on a proposed new collection of information, a Small Business 
Lending Survey of banks that is proposed to be

[[Page 6262]]

fielded in June 2016. The FDIC received two comments related to this 
survey effort.
    One commenter suggested that the FDIC separate the proposed survey 
into two separate surveys, one on small business lending and one on 
consumer bank accounts, in order to encourage participation, reduce the 
burden on respondents and ensure the accuracy of information collected 
regarding consumer bank accounts. To ensure accurate responses and 
minimize the effort necessary to gather information needed for 
responses, the FDIC conducted three rounds of cognitive testing of the 
survey questions across the U.S. in 10 states with 40 banks of 
different sizes and that serve different types of market areas. The 
cognitive testing was conducted to ensure that the survey questions are 
clearly worded and understood by bank personnel, and primarily draw on 
expert knowledge or data available in existing internal reports. To 
ensure that the appropriate bank personnel respond to the survey 
questions for which they have subject-matter expertise, the FDIC has 
also organized the questions into distinct sections that can be 
accessed independently and answered by different bank personnel. In 
addition, the section containing the consumer bank account questions 
has been renamed ``Information about Consumer Bank Accounts'' to more 
clearly indicate its focus. Fielding two separate surveys at about the 
same time may decrease participation for both surveys, and may increase 
the challenge of communicating with banks about the surveys, resulting 
in increased confusion.
    One commenter recommended that the FDIC accurately explain the goal 
of the consumer bank account questions. The FDIC has revised the 
introduction to the ``Information about Consumer Bank Accounts'' 
section that explains the purpose of the consumer bank account 
questions. Additionally, the FDIC will transmit the survey to 
respondent banks with a cover letter, which will include an overview of 
the survey and a discussion of the motivation for each section.
    One commenter queried whether the question regarding ``network 
branded general purpose reloadable prepaid cards'' is intended to 
identify the universe of alternatives to full-service checking accounts 
offered by insured depository institutions, and, more specifically, 
expressed concern regarding the lack of definition of ``network branded 
general purpose reloadable prepaid cards.'' The FDIC intends this 
question to inquire about a specific type of card-based product offered 
by some insured depository institutions, not the universe of 
alternatives to full-service checking accounts. This question has been 
edited to refer specifically to ``a Visa or MasterCard branded general 
purpose reloadable (GPR) prepaid card that your bank markets directly 
to consumers in your market area.'' This revision is responsive to 
feedback that the FDIC received from the three rounds of cognitive 
testing with banks of different sizes and that serve different types of 
markets.
    One commenter recommended that two questions about bank applicant 
screening processes, specifically inquiring whether prior account 
closure due to account mismanagement or applicant fraud on a prior 
account would make an applicant ineligible to open a basic, entry-level 
consumer checking account, be changed from accepting only ``yes'' and 
``no'' responses to also including a third potential response of ``it 
depends.'' This commenter also suggested the addition of a follow-up 
question asking whether the bank offers an alternative account to those 
ineligible for the standard checking account. The FDIC has removed from 
the survey the question regarding applicant fraud on a prior account. 
The question regarding account mismanagement has been revised to 
include a third response, that applicants in this situation would be 
``eligible to open a second-chance account or an account with more 
limited features.'' The additional answer was developed in response to 
feedback from cognitive testing and is responsive to the suggestion 
offered here by the commenter.
    One commenter cautioned that the FDIC should be mindful of the 
complexity and range of reasons why unbanked and under banked consumers 
do not fully engage with the banking system. This commenter expressed 
concern that the proposed consumer account questions in the survey 
focus on the costs of bank accounts and prior account mismanagement as 
impediments to opening bank accounts when studies suggest that the 
primary reasons for consumers not having an account are not having 
enough money or not wanting or needing an account. This commenter also 
cautioned that regulations may impede banks' ability to offer consumer 
products that might encourage greater participation within the banking 
system.
    The FDIC is interested in the full range of reasons why some 
consumers are unbanked. To that end, the FDIC has asked, in each 
biennial Survey of Unbanked and Underbanked Households, for all the 
reasons that households are unbanked. The consumer banking section of 
this survey is intended, in large part, to provide a factual context 
for interpreting some of the results of other FDIC research efforts 
into consumer engagement with financial services and institutions. The 
consumer bank account questions in this survey represent one prong in a 
multi-pronged approach to understanding how unbanked and lower-income 
consumers make decisions about using financial services, how banks 
engage with those consumers through the development of products and 
services and outreach programs, and contextual factors that influence 
the choices of both consumers and banks.
    One commenter expressed concern regarding the level of effort 
required of banks, especially community banks, to respond to the 
survey. The FDIC has made a concerted effort to streamline the survey 
and reduce the burden associated with providing responses. This effort 
included three rounds of cognitive testing of the survey questions with 
banks of different sizes and that serve different types of market areas 
to ensure that the survey will capture useful information while 
minimizing response burden. In response to feedback from the cognitive 
testing, the FDIC has significantly reduced the number of questions in 
the survey, retaining only questions that rely on expert knowledge and 
do not require the gathering of data, or questions that require data 
that can be provided from core data systems or from existing internal 
reports. Additionally, the FDIC has also reduced the number of question 
that will be answered by banks with less than $1 billion in assets. In 
addition, the FDIC has revised the survey to include screener questions 
that will also reduce the number of questions for banks with $1 billion 
or more in assets whose systems do not collect specific information. 
The revised survey is now significantly shorter for banks of all sizes.

Request for Comment

    Comments are invited on: (a) Whether the collection of information 
is necessary for the proper performance of the FDIC's functions, 
including whether the information has practical utility; (b) the 
accuracy of the estimates of the burden of the information collection; 
(c) ways to enhance the quality, utility, and clarity of the 
information to be collected; and (d) ways to minimize the burden of the 
information collection on respondents, including through the use

[[Page 6263]]

of automated collection techniques or other forms of information 
technology.
    The FDIC will consider all comments to determine the extent to 
which the survey instruments should be modified prior to submission to 
OMB for review and approval. After the comment period closes, comments 
will be summarized and included in the FDIC's request to OMB for 
approval of the collection. All comments will become a matter of public 
record.

    Dated at Washington, DC, this 2nd day of February, 2016.

    Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.
[FR Doc. 2016-02237 Filed 2-4-16; 8:45 am]
BILLING CODE 6714-01-P