The "South Carolina Transparency in Consumer Legal Funding Act" introduces a regulatory framework aimed at enhancing consumer protections in legal funding transactions. It establishes specific requirements for consumer legal funding contracts, mandating clear language, a right of rescission, and detailed disclosures about charges and repayment terms. The act prohibits deceptive practices by funding companies, such as paying referral fees to attorneys, and requires contracts to be easily understandable, with provisions for translation if necessary. Additionally, the bill clarifies that consumer legal funding is not classified as a loan, thus exempting it from traditional loan regulations.

To ensure compliance and accountability, the bill mandates that consumer legal funding companies register with the state, pay a fifty-dollar renewal registration fee every two years, and file a bond or irrevocable letter of credit not exceeding one hundred dollars. It allows companies to engage in funding while their registration is pending approval, but prohibits the use of any contracts that have not been filed with the Secretary of State. The Secretary is also empowered to adopt necessary rules for implementation. The legislation includes a severability clause to maintain the effectiveness of remaining provisions if any part is found unconstitutional or invalid, and it will take effect upon the Governor's approval.