Bill > SB728

This bill expands the California Consumer Financial Protection Law (CCFPL) to include protections for small businesses from abusive financial practices. Starting January 1, 2027, the bill will require commercial financing providers and brokers to register with the Commissioner of Financial Protection and Innovation before offering commercial financing products to California residents. The bill introduces several key consumer protections for small businesses, including prohibiting providers from taking a confession of judgment or power of attorney before a default, preventing the attachment or garnishment of a recipient's bank accounts, and ensuring that unconscionable financing transactions can be challenged. Commercial financing brokers will also be required to transparently display average and maximum annual percentage rates on their websites. The legislation recognizes that small business owners are often in a similar position to consumers in terms of financial sophistication and bargaining power, and aims to provide them with legal safeguards similar to those afforded to individual consumers. By expanding the CCFPL's purpose to include small business protection, the bill seeks to promote fair competition, wealth creation, and prevent predatory financial practices that could harm small businesses.

Budget and Finance, Business and Industry, Justice

https://leginfo.legislature.ca.gov/faces/billStatusClient.xhtml?bill_id=202520260SB728