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Bill

HB 2595

Insurance; Insurance Act of 2025; effective date.

2025 Regular Session Introduced by Brian Hill

The act requires registered providers of commercial financing to disclose standardized costs and terms to small businesses, enhancing transparency.

Second Reading referred to Rules
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Bill Summary · HB 2595

Summary — HB 2595: Business Truth in Lending Act (Small Business Financing Transparency Act)

Status: Introduced (2/6–2/7/2025); Rule 19(a) / Re‑referred to Rules Committee
Primary sponsor (Illinois text): Rep. Curtis J. Tarver, II
Note: The bill text provided also includes an unrelated Arizona HB 2595 (municipal attainable housing). This summary focuses on the Illinois “Small Business Financing Transparency Act” (aka Business Truth in Lending Act) text, and closes with a short note about the Arizona material.

Purpose

Establish a regulatory framework to increase transparency and consumer‑style disclosure for commercial financing to small businesses. The stated goal is to protect business owners by requiring registration of providers, standardized disclosures of financing costs, centralized reporting, and enforcement tools for the Illinois Department of Financial and Professional Regulation (IDFPR).

Key provisions

  • Creates the Small Business Financing Transparency Act (new provisions added to state law; also makes conforming amendments to the Freedom of Information Act and the Consumer Fraud and Deceptive Business Practices Act).
  • Registration:
    • Requires persons who make specific offers of commercial financing to register with IDFPR unless exempt.
    • Requires additional registration information, sets registration expiration and fees, and establishes registration discipline (suspension, civil penalties).
    • Exemptions include federally chartered banks, insured state banks/credit unions, lenders regulated under the Farm Credit Act, and certain technology service providers to those institutions.
  • Definitions clarified for terms such as “commercial financing” (open‑end, closed‑end, factoring and similar business uses), “provider,” “recipient,” “finance charge” (expressed as a dollar amount), and “commercial financing database.”
  • Disclosure requirements:
    • Providers must deliver standardized disclosures describing the finance charge, terms, and other material elements of commercial financings.
    • Providers must document that the recipient intends to use proceeds for business/commercial purposes (recipient statement may be signed or oral if documented).
    • Commercial financing disclosure forms used in other states may be recognized.
  • Reporting and database:
    • Establishes a certification process for commercial financing reporting databases and requires reporting to a certified commercial financing database.
  • Enforcement and remedies:
    • Grants investigative authority and subpoena power to the Secretary/IDFPR.
    • Provides for suspension of registrations, civil penalties, cease‑and‑desist orders, injunctions, complaint investigations, confidentiality protections, and administrative appeals/review.
    • Limits on provider liability and rulesmaking authority for implementation.
  • Effective date: Act stated to be effective immediately.

Who is affected

  • Affected: Non‑exempt providers of commercial financing (nonbank lenders, factors, marketplace lenders, brokers who make specific offers), and small businesses that receive commercial financing in Illinois.
  • Not affected/exempted: Federally chartered banks, insured state banks/savings institutions, credit unions, Farm Credit lenders, and some tech service providers to these entities.

Potential impacts

  • Increased transparency for small businesses—standardized dollar finance‑charge disclosures should improve comparability across offers.
  • Compliance costs and registration/reporting burdens for nonbank lenders and finance brokers; potential administrative penalties for noncompliance.
  • Creation of a statewide data repository could enable regulators and researchers to monitor commercial finance markets and abuses but also raises questions about data security/confidentiality.
  • Amends related statutes (FOIA and Consumer Fraud Act), which could affect public access to filings and enforcement tools.

Procedural status / timeline

  • Introduced early February 2025; as of the provided materials the bill is at Rule 19(a) and re‑referred to the Rules Committee. The text indicates immediate effectiveness upon enactment.

Note on conflicting material

The packet also included an unrelated Arizona HB 2595 (concerning municipal attainable housing: allowing cities to require up to 20% of new multifamily units be “attainable” for up to 20 years, for projects ≥20 units, with developer incentives and a 120% of county median income definition). Confirm the intended jurisdiction and version before relying on procedural history or sponsor information, as the provided metadata mixes Illinois and Arizona content.

Compiled from official sources — confirm details with the bill’s official record.

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