As of January 1, 2024, both Georgia and Florida have implemented new regulatory changes impacting small business financing disclosure requirements. With these additions, more states are joining California and New York in setting transparency standards for commercial financing. This update highlights the importance of understanding and adhering to these disclosure laws, which are now actively enforced.
What is Georgia’s SB 90: Commercial Financing Disclosure Requirements?
Georgia’s Senate Bill 90 (SB 90), an amendment to the Fair Business Practices Act, requires providers of commercial financing—including both closed-end and open-end transactions, as well as accounts receivable purchase transactions of $500,000 or less—to issue specific disclosures to applicants before a transaction is finalized.
Funders must now disclose the following:
- 1. Total funding amount
- 2. Net funds disbursed
- 3. Total payment to the provider
- 4. Total cost of financing
- 5. Payment schedule
- 6. Any prepayment penalties
Unlike similar regulations in California and New York, Georgia does not require disclosure of an annual percentage rate (APR).
Additionally, unlike Utah and Virginia, Georgia does not require licensing or registration, simplifying compliance obligations for funders operating in the state.
What is Florida HB 1353: Commercial Financing Disclosure Law?
Florida’s Commercial Financing Disclosure Law (HB 1353) similarly requires that providers deliver a written disclosure at or before the consummation of a commercial financing transaction. The law applies to a range of financing products, including loans, lines of credit, and accounts receivable purchase transactions—with certain exceptions.
Required disclosures include:
- – Total financing amount
- – Disbursement amount (net of deductions)
- – Total repayment amount
- – Total dollar cost of financing
- – Payment terms and schedule
- – Prepayment rights and conditions
Only one written disclosure is required, simplifying the process while ensuring transparency for small businesses.
What are the Penalties and Enforcement for Non-Compliance?
Georgia
Non-compliance may result in civil penalties of $500 per violation, capped at $20,000. Continued violations can incur additional penalties. Notably, violations do not invalidate the financing agreement and the law does not permit private rights of action.
Florida
Enforcement authority lies exclusively with the Florida Attorney General. Fines range from $500 to $1,000 per violation, capped at $20,000—or $50,000 in cases of repeat violations after receiving prior notice. Similar to Georgia, violations do not render the agreement void, nor does the law allow for private lawsuits.
CFGMS™ ISO Partners Stay Ahead with Direct Compliance Access
CFG Merchant Solutions (CFGMS™) ensures that its ISO partners are equipped with the latest regulatory insights and support. For questions about current or upcoming disclosure requirements—including those in Florida, California, New York, Virginia, Utah, Connecticut, and Georgia—ISO partners are encouraged to contact the Compliance Department at compliance@cfgms.com.
Dan Taylor, Vice President of Compliance & Data Assurance, is available to provide direct guidance and help ensure ISOs remain compliant as laws evolve.
References for FL and GA Disclosure Regulations
https://www.adamsandreese.com/insights/georgia-florida-pass-commercial-financing-disclosure-laws
Adams and Reese write about the Georgia and Florida Commercial Financing Disclosure Law the day it passed.
Mayer Brown speaks specifically about Georgia enacting the commercial financing disclosure law.
https://www.venable.com/insights/publications/2024/06/new-commercial-financing-requirements-become
Venable LLC speaks on new commercial financing requirements for funders and brokers.
https://www.legis.ga.gov/api/legislation/document/20232024/219440
The official Florida CFDL bill.
https://www.flhouse.gov/Sections/bills/billsdetail.aspx?
The Florida House offers specific details on its CFDL.