Commercial finance providers doing business in New York will have more time to comply with New York’s new law requiring consumer-like disclosures to be made for certain types of commercial financing. The law previously was to take effect on January 1, 2022, but on New Year’s Eve, the New York Department of Financial Services (DFS) issued guidance stating that the “obligations do not arise until the Department issues final implementing regulations and those regulations take effect.”
Given that the DFS’s most recent proposed regulations provide for a compliance date “six months after publication of the Notice of Adoption in the State Register,” providers of commercial financing will have until at least the summer to comply. Companies should be aware, however, that substantial work will be required to comply with the new law. For example, the new law will require providers to calculate and disclose APRs, which will be challenging particularly for certain types of financing such as products with uncertain payment amounts.
