There are multiple things being discussed in this thread.

1. lender/broker licensing (an old requirement)
2. commercial financing disclosure (a new requirement)


---
1. If you do MCA, the answer to #1 is something your lawyer will have to answer. In the past it has been possible to do MCAs without a license. It also been risky so you must talk to an attorney about this.

2. If you do MCA, whether ACH or split, you are subject to the commercial financing disclosure law that goes into effect in 2 days and all that entails. It is a highly complex law with a lot of moving pieces. You cannot wing it and throw in a form or whatever and think you'll be good. These regulations took more than 4 years to create and it requires very competent legal counsel to even attempt to successfully navigate.


Quote Originally Posted by ADiamond View Post
https://debanked.com/?s=california+license&x=0&y=0

https://dfpi.ca.gov/california-finan...law-about/#Who


1) You all really should be consulting legal professionals for clarity, but I would love for Sean & Debanked to update some current guidance for this as all of their articles are circa 2015-2016 when this was a problem.

2) A "MCA" is not a loan in CA, it appears, and as such is not subject to lending licenses. HOWEVER, it appears they are subject to APR disclosure laws and lending license or not, it appears that a BROKER OF ANY financial product or financial product marketing is required to be licensed in CA, from my interpretation of the Expansion Capital legal filing I found below. Correct me if I am wrong on that last part?

3) It appears as far as "MCAs" are concerned in CA, they are super strict on disclosure notice - although I've read in some places they admit that "APR" can technically not be calculated for a MCA, and if we're being honest "APR" theoretically does not even apply to a MCA product from a financial standpoint, but who knows? CA also appears to be super strict on MCA companies abiding by their specified percentage / reconciliation clauses in order for the contract to be valid.


https://dfpi.ca.gov/2020/04/06/advis...nce-contracts/

https://dfpi.ca.gov/wp-content/uploa...-Group-LLC.pdf

A lot of info in this, just search "merchant cash"
https://dfpi.ca.gov/wp-content/uploa...01-18-RBLC.pdf