Bill > HB2595

This bill creates the Small Business Financing Transparency Act, which establishes a comprehensive regulatory framework for commercial financing providers in Illinois. The bill requires providers of commercial financing (such as sales-based financing, closed-end financing, open-end financing, and factoring transactions) to register with the Department of Financial and Professional Regulation and provide detailed, standardized disclosures to recipients. These disclosures must include key information like the total financing amount, finance charges, estimated annual percentage rate, total repayment amount, payment terms, and potential additional fees. Providers must register annually, pay a $2,500 fee, and submit extensive information about their financing offers. The bill also establishes a commercial financing database where providers must report detailed transaction information, with strict confidentiality provisions. Exemptions exist for certain types of financial institutions, transactions under specific dollar amounts, and providers making few financing transactions. The Department of Financial and Professional Regulation will have broad investigative and enforcement powers, including the ability to issue cease and desist orders, impose civil penalties, and revoke registrations for violations. The registration and disclosure requirements will begin no earlier than January 1, 2026, giving businesses time to prepare for the new regulations.

Budget and Finance

https://www.ilga.gov/legislation/BillStatus.asp?DocNum=2595&GAID=18&DocTypeID=HB&SessionID=114&GA=104