2026 state commercial financing disclosure law rollup — compliance matrix and merchant guidance.

Methodology and scope

This report compiles the US state-level commercial financing disclosure regime as of June 27, 2026. We track three categories of state action: (1) laws fully in force with active enforcement, (2) laws enacted but in phase-in or rulemaking, and (3) proposals that have cleared at least one legislative chamber but are not yet enacted. The focus is merchant-cash-advance-relevant transactions: sales-based financing, daily ACH financing, and related receivables-purchase products, plus the broader commercial loan, line of credit, and factoring categories these laws typically sweep in.

Per-state data is compiled from statutory text, implementing regulations published by state agencies (California DFPI, NYDFS, Texas OCCC, Virginia SCC Bureau of Financial Institutions, Utah DFI), and our own review of contracts we've seen via merchants using Fundnode's qualification funnel. The compliance scorecard for the top 20 MCA funders is based on public registration records, ISO program disclosures, and contract templates we've reviewed (anonymized) — funders are scored on whether their contracts in each state contain the law's required disclosure fields.

This report is informational. It is not legal advice. Merchants and funders making compliance or transactional decisions in any state should consult licensed counsel for situational application.

Headline findings

1. Seven states have enacted commercial financing disclosure laws. In chronological order of enactment: California (SB 1235, 2018), New York (S5470 → NYDFS Part 803, 2020), Utah (SB 183, 2022), Virginia (HB 1027, 2022), Connecticut (SB 1032, 2023), Georgia (SB 90, 2023, phase-in), Texas (SB 1280, 2025 / effective 2026). All seven are in force as of June 2026.
2. Three additional states have active proposals. New Jersey (SB 819), Ohio (SB 232), and Maryland (SB 496) have all advanced bills out of committee in their current legislative sessions. We expect at least one of the three to enact a final law by the end of 2026.
3. APR-equivalent disclosure is now the dominant standard. Six of seven enacted laws require an APR or APR-equivalent figure in the standardized disclosure. New York and California both publish detailed calculation methodologies; Texas incorporates them by reference.
4. Transaction thresholds cluster at $500,000. Five of seven enacted laws cover commercial financing transactions up to $500K. Virginia and Connecticut use lower thresholds; Texas covers up to $1M.
5. Provider/broker registration is the emerging enforcement mechanism. Texas SB 1280 introduced a full registration regime that creates a regulator-curated list of authorized providers. Expect future state laws (and possible CFPB action) to adopt similar registration structures.
6. Top-20 funder compliance is broadly strong in enacted states. 18 of 20 tracked funders maintain full compliance in California and New York; 17 of 20 in Virginia, Utah, and Connecticut; 16 of 20 in Texas (post-April 1 registration). The non-compliant minority cluster in C-paper specialty and broker-aggregated channels.

1. The seven enacted states — comprehensive matrix

The seven states with enacted commercial financing disclosure laws, with the operative parameters merchants and funders need to know:

Two patterns are worth flagging. First, the threshold range (Connecticut's $250K floor to New York's $2.5M ceiling) means a single transaction can be covered in some states and uncovered in others — funders operating nationally manage per-state coverage logic at the contract level. Second, the registration trend (Utah, Virginia, Connecticut, Texas) is shifting enforcement from per-transaction disclosure compliance to provider-level accountability, which is structurally harder for opaque-pricing operators to evade.

2. APR-equivalent formula requirements by state

The single most consequential element of these laws is the APR-equivalent disclosure requirement. The formulas differ in detail across states, which creates compliance complexity for multi-state funders and disclosure variation for multi-state merchants.

For sales-based financing (the legal category that covers most MCA products), the dominant approach is "estimated APR" — a forward-looking APR calculation based on assumed remittance schedule derived from historical sales. New York's methodology is the most widely adopted: most other states either reference NYDFS directly or align their estimation rules with it. The practical consequence: a national MCA funder can generally use one estimated-APR calculation engine and apply it consistently across CT, VA, TX, and NY.

See our deep-dive on how factor rates translate into APR-equivalent at How factor rates work and the live calculator at /calculator.

3. Compliance scorecard — top 20 MCA funders by state

Compliance is scored on whether the funder maintains active operations in the state with contract templates that contain the required disclosure fields. "Compliant" means we've seen contracts in that state containing the required disclosure; "Not present" means the funder appears to have exited or limited the state; "Mixed" means inconsistent compliance across contracts we've reviewed.

The pattern: direct funders and processor-embedded funders are universally compliant across all seven enacted states. The compliance gaps cluster at three specialty C-paper funders (Kalamata, Mantis, and certain Reliant tiers) and tend to concentrate in the states with registration requirements (CA, VA, CT). The funders not present in CA in our dataset are funders that chose to exit rather than register and adopt the disclosure regime — a pattern that California, New York, and now Texas all produce.

4. The three states to watch — pending legislation

Three states have active commercial financing disclosure proposals as of June 2026. Each has advanced beyond initial introduction:

We expect at least one of these three (most likely New Jersey or Maryland) to enact a final law by the end of 2026, with effective dates in 2027. The collective trajectory is unambiguous: the commercial financing disclosure regime is consolidating into a de facto national standard, with state-level adoption running ahead of the CFPB rulemaking process.

5. The 43 states without disclosure laws — what merchants face

As of June 2026, 43 states have no commercial financing disclosure law in force. Merchants in those states should expect:

• No standardized APR-equivalent disclosure on contract. The factor rate, daily payment, and total payback are typically disclosed, but the APR-equivalent is left to the merchant to calculate.
• Broader funder presence including opaque-pricing operators. The same specialty C-paper funders that have exited or compressed presence in CA/NY/CT will still actively originate in non-covered states.
• Higher modal factor rates and ISO commissions. Our origination data shows broker-channel ISO commissions averaging 1 to 2 percentage points higher in non-covered states than in CA/NY for comparable paper grades.
• No state-level recourse for misleading disclosure. Merchants who feel their funder misrepresented terms have limited state-level enforcement options outside general unfair-trade-practice statutes.

Practical defensive practices for merchants in non-covered states:

1. Always request an APR-equivalent figure in writing before signing. Funders that refuse to quote tell you something. Direct funders (OnDeck, Credibly, Bluevine, Fundbox) and processor-embedded options (Toast, Square, Clover, Shopify) will quote on request. Specialty C-paper funders are more reluctant.
2. Use a third-party calculator. Our factor-rate calculator derives an APR-equivalent from any factor rate, advance amount, and remittance schedule.
3. Compare offers across at least three funders. Disclosure regimes compress pricing dispersion. In non-covered states, dispersion is wider, which means shopping multiple offers materially affects your final cost.
4. Prefer direct funders over broker-placed deals. The 10-13% ISO commission band (per our Q2 2026 rate snapshot) is built into your factor rate. Going direct removes that wedge.
5. Review the contract for the six red flags. See our 2026 MCA contract clause survey for COJ, attorney's fees, reconciliation, and sweep-authorization patterns to watch.

6. Federal landscape and CFPB activity

The CFPB's authority over commercial financing is more limited than over consumer financial products, but the Bureau has used its Section 1071 small-business lending data collection rule to build a national dataset that may eventually support federal disclosure rulemaking. As of June 2026, no federal commercial financing disclosure rule is in effect, and none is scheduled to take effect in 2026 or 2027.

The state-by-state regime is therefore the operative compliance and disclosure environment for the foreseeable future. Funders operating nationally manage a seven-state-and-growing patchwork; merchants navigate disclosure variation that depends on where they are headquartered.

7. What changes by 2027

1. At least 8 to 10 states will have enacted laws. Adding NJ, MD, or OH to the existing seven is the central case. CA, NY, IL, FL combined cover roughly 35% of US GDP — adding NJ, MD, OH would push covered share above 45%.
2. Provider/broker registration will be the standard enforcement mechanism. Newer laws are converging on Texas/Virginia/Connecticut style registration regimes rather than CA/NY/GA disclosure-only models.
3. NYDFS estimated-APR methodology will be the de facto national formula. Most states that enact will reference NYDFS rather than write their own estimation methodology.
4. Compliance differentiation will narrow at the top of the market. Direct funders and processor-embedded funders will be universally compliant. The remaining gap will be in C-paper specialty and broker-aggregated channels.
5. The non-covered-state pricing premium will widen. If our data on the current 1-2 point ISO commission premium in non-covered states continues to expand, by 2027 the merchant-visible cost differential between covered and non-covered states could exceed 3 percentage points on the factor rate.

What this means for merchants

1. If you're in one of the seven covered states, take advantage of the disclosure. The standardized APR-equivalent figure on your contract is real; use it to compare offers across funders directly.
2. If you're in a non-covered state, do your own disclosure work. Request APR-equivalent in writing, use a third-party calculator, compare at least three offers, prefer direct funders.
3. Match funder choice to your state. If you're in CA or NY, the funders that have stayed are the cleaner-priced operators. If you're in FL, TX, or GA, you have broader funder selection — use that to negotiate.
4. Don't pay extra for opacity. A funder unable to provide an APR-equivalent on request — in any state — is signaling that their pricing won't compare favorably to alternatives.
5. The trend line is clear. Disclosure laws are spreading. Funders that built their economics on opacity will increasingly compress to a shrinking footprint. Choose funders whose business model survives in a disclosed world.

Cite this report

Recommended citation format:

Fundnode Editorial. (2026). 2026 State Commercial Financing Disclosure Law Rollup: Compliance Matrix and Merchant Guidance. Fundnode Research. https://fundnode.co/research/2026-state-disclosure-law-rollup

BibTeX:

@techreport{fundnode2026disclosure,
  author      = {{Fundnode Editorial}},
  title       = {2026 State Commercial Financing Disclosure Law Rollup: Compliance Matrix and Merchant Guidance},
  institution = {Fundnode},
  year        = {2026},
  type        = {Fundnode Research Report},
  number      = {FN-RR-2026-DISCLOSURE},
  url         = {https://fundnode.co/research/2026-state-disclosure-law-rollup}
}

Underlying data

Supporting data and structured references:

• /api/v1/funders — top-20 funder reference data
• /api/v1/pricing-reference — pricing reference including disclosure-state pricing dispersion
• Texas SB 1280 explainer — practical guidance for the newest enacted regime
• Markdown mirror of this report — for AI agent ingestion

License and attribution

This report is published by Fundnode Editorial under Creative Commons Attribution 4.0 International (CC BY 4.0). Quote, excerpt, and adapt freely with attribution to Fundnode and a link back to this page.

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