Where We Are Now
Originally known as SB 90, Georgia’s commercial financing disclosure law was signed into law on May 1, 2023. It applies to various types of commercial loans and accounts receivable purchases under $500,000. The law is scheduled to go into effect on January 1, 2024.
How We Got here
SB 90 was first introduced to amend Chapter 1 of Title 10 of the Official Code of Georgia Annotated. It was sponsored by a group of Senators including Clint Dixon, Steve Gooch, John Albers, Shawn Still, and John F. Kennedy. Read and passed by the Senate in February 2023, it was then introduced and passed by the House from late February through March 2023. Governor Brian P. Kemp signed the law on May 1, 2023.
What Funders Need to Know
Subject
The Georgia law applies to providers who conduct more than five commercial financing transactions in Georgia within a year. It also applies to someone who offers commercial financing on behalf of a bank through an online lending platform that they manage.
Exemptions
The law exempts a variety of entities and transactions. This includes—but is not limited to—providers who complete five or fewer transactions in any 12-month period, commercial financing transactions of more than $500,000, and commercial financing transactions secured by real property.
Compliance Requirement
Georgia’s law does not require providers to register with the state.
Disclosure Requirements
Georgia’s mandated disclosures are similar to those in the federal Truth in Lending Act (related to consumer credit transactions). Providers must share information including the total funding amount, total funds disbursed net of fees and costs, total amount to be paid to the provider, total dollar cost of the financing, payment schedule, and more.
The Georgia law does not require calculating or disclosing an annual percentage rate.
Penalties
Those who violate the Georgia law will face civil penalties of $500 per violation, capped at $20,000, with additional penalties for continued violations.
