MCA Disclosure Laws

**New York** {#new-york}

Where We Are Currently

Effective since **August 1, 2023**, New York requires certain providers to give standardized disclosures for specific offers of commercial financing under **23 NYCRR 600**. These regulations cover loans, open-end credit, sales-based financing, factoring, and lease financing, requiring detailed disclosure of total financing amount, finance charge, total repayment, payment schedule or method, and prepayment terms. The law is administered by the **Department of Financial Services (DFS)** and reflects one of the most comprehensive state regimes to date, incorporating model forms, calculation methods, and signature requirements. Providers must use the correct disclosure variant for their product type and ensure timing aligns with the “specific offer” trigger. [Buchalter](https://www.buchalter.com/insights/ny-dfs-publishes-final-regulation-implementing-article-8-new-york-states-commercial-finance-disclosure-law/?utm_source=chatgpt.com)

How We Got Here

DFS promulgated 23 NYCRR 600 on February 1, 2023, with a six-month compliance runway to August 1, 2023. The regulation implements New York’s Commercial Finance Disclosure Law (Article 8). [Department of Financial Services](https://www.dfs.ny.gov/industry_guidance/regulations/final_financial_services/rf_finservices_23nycrr600_text?utm_source=chatgpt.com)

What Funders Need to Know

Subject

The rules apply to providers making specific offers of commercial financing to recipients, and address broker roles and compensation disclosures. [Department of Financial Services](https://www.dfs.ny.gov/industry_guidance/regulations/final_financial_services/rf_finservices_23nycrr600_text?utm_source=chatgpt.com)

Exemptions

Article 8 exempts, among others, depository institutions and certain technology service providers; coverage and exemptions are defined in the statute and implemented by 23 NYCRR 600. [Justia Law](https://law.justia.com/codes/new-york/fis/article-8/?utm_source=chatgpt.com)

Compliance Requirement

The regulation does not create a separate license; providers must comply with DFS’s prescribed forms, content, and timing tied to a “specific offer.” [Department of Financial Services](https://www.dfs.ny.gov/system/files/documents/2023/01/rf_finservices_23nycrr600_text.pdf?utm_source=chatgpt.com)

Disclosure Requirements

Disclosures include total amount of financing, finance charge/total repayment, payment schedule or method, prepayment terms, and other itemized elements set by 23 NYCRR 600. Timing aligns with the extension of a specific offer. [Department of Financial Services](https://www.dfs.ny.gov/industry_guidance/regulations/final_financial_services/rf_finservices_23nycrr600_text?utm_source=chatgpt.com)

Other Rules (optional)

DFS adopted product-specific forms and calculation methods (closed-end, open-end, sales-based financing, factoring) and defined when a “specific offer” triggers disclosures in Part 600. [Department of Financial Services](https://www.dfs.ny.gov/system/files/documents/2023/01/rf_finservices_23nycrr600_text.pdf?utm_source=chatgpt.com)

Penalties

DFS enforces Article 8; Financial Services Law § 812 authorizes civil penalties for violations of the statute or regulations. [New York State Senate](https://www.nysenate.gov/legislation/laws/FIS/812?utm_source=chatgpt.com)

Official Documents (links)

• 23 NYCRR 600 – Disclosure Requirements for Certain Providers of Commercial Financing Transactions, New York DFS (final text). [Department of Financial Services](https://www.dfs.ny.gov/industry_guidance/regulations/final_financial_services/rf_finservices_23nycrr600_text?utm_source=chatgpt.com)

Expert Opinions and Analysis (links)

• NY DFS Final Regulation Implementing Article 8, Buchalter. [Buchalter](https://www.buchalter.com/insights/ny-dfs-publishes-final-regulation-implementing-article-8-new-york-states-commercial-finance-disclosure-law/?utm_source=chatgpt.com)
• New York’s “Small Business” Commercial Financing Disclosure Law, Holland & Knight. [Holland & Knight](https://www.hklaw.com/en/insights/publications/2023/03/new-yorks-small-business-commercial-financing-disclosure-law?utm_source=chatgpt.com)

Operator Checklist

• Identify when you’re extending a “specific offer,” then trigger disclosures at that point. [Department of Financial Services](https://www.dfs.ny.gov/industry_guidance/regulations/final_financial_services/rf_finservices_23nycrr600_text?utm_source=chatgpt.com)

• Use the correct form and calculation method for your product type. [Department of Financial Services](https://www.dfs.ny.gov/industry_guidance/regulations/final_financial_services/rf_finservices_23nycrr600_text?utm_source=chatgpt.com)

• Include prepayment language and any broker compensation items required. [Department of Financial Services](https://www.dfs.ny.gov/industry_guidance/regulations/final_financial_services/rf_finservices_23nycrr600_text?utm_source=chatgpt.com)

• Track the Aug 1, 2023 operational start for audit references. [Buchalter](https://www.buchalter.com/insights/ny-dfs-publishes-final-regulation-implementing-article-8-new-york-states-commercial-finance-disclosure-law/?utm_source=chatgpt.com)