A03637 Summary:

BILL NOA03637
 
SAME ASSAME AS S03850
 
SPONSORNiou
 
COSPNSRPeoples-Stokes, Barron, Kim, Englebright, Frontus, Richardson, D'Urso, Fall, Sayegh, Blake, Solages, Pretlow, Reyes
 
MLTSPNSR
 
Add 340-a, Bank L
 
Deems asset-based lending transactions to be loans for all purposes.
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A03637 Actions:

BILL NOA03637
 
01/30/2019referred to banks
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A03637 Committee Votes:

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A03637 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A3637
 
SPONSOR: Niou
  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 individ- uals.   PRIOR LEGISLATIVE HISTORY: No prior legislative history.   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.
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A03637 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          3637
 
                               2019-2020 Regular Sessions
 
                   IN ASSEMBLY
 
                                    January 30, 2019
                                       ___________
 
        Introduced by M. of A. NIOU, PEOPLES-STOKES -- read once and referred to
          the Committee on Banks
 
        AN  ACT  to  amend  the  banking law, in relation to asset-based lending
          transactions
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section 1. The banking law is amended by adding a new section 340-a to
     2  read as follows:
     3    §  340-a. Asset-based lending transactions. 1. As used in this section
     4  the term "asset-based lending transaction" shall mean a  transaction  in
     5  which advances are made which are contingent on the recipient forwarding
     6  payments  received from one or more third parties for goods such recipi-
     7  ent has supplied or services such recipient has rendered to  that  third
     8  party or parties.
     9    2.  All  asset-based  lending transactions shall be deemed to be loans
    10  for all purposes.
    11    § 2. This act shall take effect on the ninetieth day  after  it  shall
    12  have become a law.
 
 
 
 
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD03355-01-9
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A03637 Chamber Video/Transcript:

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