Bill > S03177

This bill establishes a comprehensive regulatory framework for commercial finance licensing in New York State, creating a new article in the state banking law to oversee businesses that provide financing to commercial enterprises. The legislation defines "commercial financing products" as advances of funds to businesses under $500,000, including loans, purchase of receivables, and leasing transactions. The bill requires businesses engaging in such financing to obtain a license from the state superintendent of banks, with specific application requirements including financial solvency, liquid assets of at least $50,000, and a thorough background review. The legislation outlines detailed provisions for licensing, including exemptions for certain entities like banking organizations and those making five or fewer financing products annually, and establishes strict rules for licensees regarding advertising, record-keeping, and prohibited practices. Key provisions include mandating transparent and non-deceptive advertising, maintaining detailed financial records for at least two years, and prohibiting certain practices like taking confessions of judgment. The bill imposes significant penalties for non-compliance, including rendering unauthorized financing transactions void and potential misdemeanor charges for violations. The regulatory framework aims to protect small businesses by ensuring responsible and transparent commercial financing practices while providing clear guidelines for financial providers.

Budget and Finance, Business and Industry

https://www.nysenate.gov/legislation/bills/2025/S3177