BILL NUMBER: S4607
SPONSOR: SANDERS
 
TITLE OF BILL:
An act to amend the banking law, in relation to asset-based lending
transactions
 
PURPOSE OR GENERAL IDEA OF BILL:
To classify asset-based lending transactions as loans for all purposes.
 
SUMMARY OF PROVISIONS:
Section 1 - Defines "asset-based lending transactions". Subdivision
(2) - Deems all "asset-based lending transactions" as loans.
Section 2 - Provides for an effective date 90 days after this bill
becomes law.
 
DIFFERENCE BETWEEN ORIGINAL AND AMENDED VERSION (IF APPLICABLE):
 
JUSTIFICATION:
Currently, under state law, cash advances or asset-based lending trans-
actions are not subjected to state usury laws. This allowed predatory
lenders to loan large sums of capital to small businesses and individ-
uals at uncontrollable interest rates. This, in tandem with "confessions
of judgments", allows lenders to abuse the State's lack of usury laws to
entice small businesses into an uncontrollable cycle of debt. This bill
seeks to apply the regulatory standards to "asset-based cash advances"
in order to.protect unsuspecting small businesses and individuals.
 
PRIOR LEGISLATIVE HISTORY:
2021-22 REFERRED TO SENATE BANKS 2021-22 referred to assembly banks
2019-20 REFERRED TO SENATE BANKS 2019-20 referred to assembly banks
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
No fiscal implications.
 
EFFECTIVE DATE:
This act will take place on the ninetieth day after it becomes law.