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Clearer Factoring Disclosures for Small Businesses Seeking Capital (Under $500K).

This law mandates that providers must clearly disclose all costs and terms of factoring agreements (selling invoices) valued under $500,000 to small businesses. This protects small business owners by ensuring they fully understand the true cost, fees, and reserve requirements before accessing quick capital. The Act establishes a single federal standard for these disclosures, overriding inconsistent state laws.
Key points
Factoring providers must give small businesses a detailed, written disclosure listing all fees, reserves, and the difference between the invoice value and the cash paid out.
The disclosure requirement applies to factoring agreements totaling less than $500,000, focusing protection on smaller financial transactions.
Providers must include a specific $10,000 transaction example to clearly demonstrate the net amount the small business will receive after all deductions.
The federal law preempts states from imposing additional or inconsistent disclosure requirements, ensuring regulatory uniformity nationwide.
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Expired
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Additional Information
Print number: 118_HR_9632
Sponsor: Rep. Lucas, Frank D. [R-OK-3]
Process start date: 2024-09-17
Lustra uses Artificial Intelligence. Verify details in source documents.
Summarized by: gemini-2.5-flash-preview-09-2025
Source data: api.congress.gov
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OFFICIAL LEGAL TITLE

CASH Act

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 118_HR_9632.

Which chamber initiated this legislation?

This legislation was initiated in the House of Representatives.

When did the legislative process begin?

The process officially started on 2024-09-17.

What are the main provisions?

Key points include:

  • Factoring providers must give small businesses a detailed, written disclosure listing all fees, reserves, and the difference between the invoice value and the cash paid out.
  • The disclosure requirement applies to factoring agreements totaling less than $500,000, focusing protection on smaller financial transactions.
  • Providers must include a specific $10,000 transaction example to clearly demonstrate the net amount the small business will receive after all deductions.
  • The federal law preempts states from imposing additional or inconsistent disclosure requirements, ensuring regulatory uniformity nationwide.
What is the specific legal status?

The current status is Expired.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Rep. Lucas, Frank D. [R-OK-3].

What is the latest detailed status?

The latest detailed status is: Referred to the House Committee on Small Business.

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2025-12-26.

CATEGORIES

Economy Courts and Law