50-State Comparison · Updated 2026-08-20
Merchant Cash Advance by State — Laws, Rules & Requirements
11 of 50 states plus DC have enacted a commercial financing disclosure law (CFDL) that reaches merchant cash advances. The other 40 have no state-specific MCA disclosure requirement at all. Below is the full state-by-state status — every statute, every effective date, sourced — followed by a deeper look at the 11 states with a genuinely different legal answer.
How a merchant cash advance works
A merchant cash advance (MCA) is not a loan — it's a lump-sum advance against a business's future receivables, repaid through a holdback (an automatic percentage of daily or weekly card sales or bank deposits) or a fixed daily/weekly ACH debit. It's priced as a factor rate (commonly 1.1–1.5) applied to the advance amount, not an interest rate, so there's no APR to compare directly against a term loan without doing the math yourself. Because MCA is structured as a purchase of receivables rather than a loan, it generally falls outside state usury caps, and underwriting weighs card-sales or deposit volume more heavily than credit score.
The FTC and CFPB have both scrutinized MCA marketing, disclosure, and collection practices nationally, and several states have restricted confession-of-judgment clauses in commercial financing contracts in recent years — read any contract's default and collection terms closely before signing. ClearValue Lending does not fund advances directly; it routes small-business applicants to funding partners for comparison.
Merchant cash advance disclosure law, by state
All 50 states plus DC. States with an enacted CFDL that reaches sales-based financing are marked "Disclosure required" — jump to that state's section below for the specific applicability language. States marked "No state-specific law" are governed by federal law and the contract's own terms; see the general guidance above.
| State | CFDL status | Statute | Effective |
|---|---|---|---|
| Alabama | No state-specific law | Alabama — no statewide CFDL enacted as of 2026 | — |
| Alaska | No state-specific law | Alaska — no statewide CFDL enacted as of 2026 | — |
| Arizona | No state-specific law | Arizona — no statewide CFDL enacted as of 2026 | — |
| Arkansas | No state-specific law | Arkansas — no statewide CFDL enacted as of 2026 | — |
| California | Disclosure required | California SB 1235 (Commercial Financing Disclosure Law) | 2022-12-09 |
| Colorado | No state-specific law | Colorado — no statewide CFDL enacted as of 2026 | — |
| Connecticut | Disclosure required | Connecticut CGS §36a-869 (Commercial Financing Disclosure) | 2024-07-01 |
| Delaware | No state-specific law | Delaware — no statewide CFDL enacted as of 2026 | — |
| District of Columbia | No state-specific law | District of Columbia — no statewide CFDL enacted as of 2026 | — |
| Florida | Disclosure required | Florida Ch. 559.951+ (Commercial Financing Disclosure) | 2023-07-01 |
| Georgia | Disclosure required | Georgia OCGA Title 7 amendments (Commercial Financing Disclosure) | 2023-01-01 |
| Hawaii | No state-specific law | Hawaii — no statewide CFDL enacted as of 2026 | — |
| Idaho | No state-specific law | Idaho — no statewide CFDL enacted as of 2026 | — |
| Illinois | No state-specific law | Illinois — no statewide CFDL enacted as of 2026 | — |
| Indiana | No state-specific law | Indiana — no statewide CFDL enacted as of 2026 | — |
| Iowa | No state-specific law | Iowa — no statewide CFDL enacted as of 2026 | — |
| Kansas | Disclosure required | Kansas KSA Ch. 16 amendments (Commercial Financing Disclosure) | 2024-01-01 |
| Kentucky | No state-specific law | Kentucky — no statewide CFDL enacted as of 2026 | — |
| Louisiana | Disclosure required | Louisiana — HB 470 commercial financing disclosure law (effective 2025-08-01) | — |
| Maine | No state-specific law | Maine — no statewide CFDL enacted as of 2026 | — |
| Maryland | No state-specific law | Maryland — no statewide CFDL enacted as of 2026 | — |
| Massachusetts | No state-specific law | Massachusetts — no statewide CFDL enacted as of 2026 | — |
| Michigan | No state-specific law | Michigan — no statewide CFDL enacted as of 2026 | — |
| Minnesota | No state-specific law | Minnesota — no statewide CFDL enacted as of 2026 | — |
| Mississippi | No state-specific law | Mississippi — no statewide CFDL enacted as of 2026 | — |
| Missouri | Disclosure required | Missouri RSMo Ch. 408 amendments (Commercial Financing Disclosure) | 2024-01-01 |
| Montana | No state-specific law | Montana — no statewide CFDL enacted as of 2026 | — |
| Nebraska | No state-specific law | Nebraska — no statewide CFDL enacted as of 2026 | — |
| Nevada | No state-specific law | Nevada — no statewide CFDL enacted as of 2026 | — |
| New Hampshire | No state-specific law | New Hampshire — no statewide CFDL enacted as of 2026 | — |
| New Jersey | No state-specific law | New Jersey — no statewide CFDL enacted as of 2026 | — |
| New Mexico | No state-specific law | New Mexico — no statewide CFDL enacted as of 2026 | — |
| New York | Disclosure required | New York S5470B (Commercial Finance Disclosure Law) | 2022-08-01 |
| North Carolina | No state-specific law | North Carolina — no statewide CFDL enacted as of 2026 | — |
| North Dakota | No state-specific law | North Dakota — no statewide CFDL enacted as of 2026 | — |
| Ohio | No state-specific law | Ohio — no statewide CFDL enacted as of 2026 | — |
| Oklahoma | No state-specific law | Oklahoma — no statewide CFDL enacted as of 2026 | — |
| Oregon | No state-specific law | Oregon — no statewide CFDL enacted as of 2026 | — |
| Pennsylvania | No state-specific law | Pennsylvania — no statewide CFDL enacted as of 2026 | — |
| Rhode Island | No state-specific law | Rhode Island — no statewide CFDL enacted as of 2026 | — |
| South Carolina | No state-specific law | South Carolina — no statewide CFDL enacted as of 2026 | — |
| South Dakota | No state-specific law | South Dakota — no statewide CFDL enacted as of 2026 | — |
| Tennessee | No state-specific law | Tennessee — no statewide CFDL enacted as of 2026 | — |
| Texas | Disclosure required | Texas — HB 700 commercial financing disclosure law (effective 2025-09-01) | — |
| Utah | Disclosure required | Utah UCC Title 7 amendments (Commercial Financing Disclosure & Registration) | 2022-01-01 |
| Vermont | No state-specific law | Vermont — no statewide CFDL enacted as of 2026 | — |
| Virginia | Disclosure required | Virginia Code §6.2-2200 et seq. (Commercial Financing Disclosure) | 2022-07-01 |
| Washington | No state-specific law | Washington — no statewide CFDL enacted as of 2026 | — |
| West Virginia | No state-specific law | West Virginia — no statewide CFDL enacted as of 2026 | — |
| Wisconsin | No state-specific law | Wisconsin — no statewide CFDL enacted as of 2026 | — |
| Wyoming | No state-specific law | Wyoming — no statewide CFDL enacted as of 2026 | — |
Source: statute names and effective dates cross-verified against primary legislative sources and law-firm client alerts (Mayer Brown, Consumer Financial Services Law Monitor, Husch Blackwell, Hinshaw & Culbertson, Missouri Lawyers Media, National Law Review); full methodology at /methodology. Not legal advice — confirm current status with the state regulator or a licensed attorney before relying on it for a transaction.
The 11 states with a merchant cash advance disclosure law
These states enacted a commercial financing disclosure law specific enough to warrant its own explanation — the other 40 states + DC share the same general guidance in the table above.
California
StatuteCalifornia SB 1235 (Commercial Financing Disclosure Law)
Effective date2022-12-09
What it means for MCA borrowersCalifornia's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
Connecticut
StatuteConnecticut CGS §36a-869 (Commercial Financing Disclosure)
Effective date2024-07-01
What it means for MCA borrowersConnecticut's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
Florida
StatuteFlorida Ch. 559.951+ (Commercial Financing Disclosure)
Effective date2023-07-01
What it means for MCA borrowersFlorida's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
Georgia
StatuteGeorgia OCGA Title 7 amendments (Commercial Financing Disclosure)
Effective date2023-01-01
What it means for MCA borrowersGeorgia's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
Kansas
StatuteKansas KSA Ch. 16 amendments (Commercial Financing Disclosure)
Effective date2024-01-01
What it means for MCA borrowersKansas's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
Louisiana
StatuteLouisiana — HB 470 commercial financing disclosure law (effective 2025-08-01)
What it means for MCA borrowersLouisiana's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
Missouri
StatuteMissouri RSMo Ch. 408 amendments (Commercial Financing Disclosure)
Effective date2024-01-01
What it means for MCA borrowersMissouri's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
New York
StatuteNew York S5470B (Commercial Finance Disclosure Law)
Effective date2022-08-01
What it means for MCA borrowersNew York's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
Texas
StatuteTexas — HB 700 commercial financing disclosure law (effective 2025-09-01)
What it means for MCA borrowersTexas's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
Utah
StatuteUtah UCC Title 7 amendments (Commercial Financing Disclosure & Registration)
Effective date2022-01-01
What it means for MCA borrowersUtah's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
Virginia
StatuteVirginia Code §6.2-2200 et seq. (Commercial Financing Disclosure)
Effective date2022-07-01
What it means for MCA borrowersVirginia's commercial financing disclosure law defines "sales-based financing" broadly enough to reach merchant cash advances — providers must give a standardized, APR-equivalent cost disclosure (estimated APR, total repayment amount, and payment schedule) before a merchant signs. The disclosure obligation rests with the financing provider, not with ClearValue Lending as a comparison and referral platform.
Brian's take
"The pattern I'd point out to a merchant looking at this table: disclosure law is catching up to MCA state by state, not all at once, and the newest ones — Texas and Louisiana, both 2025 — show where the trend is headed. If you're in one of the 39 states with no law yet, that doesn't mean the product is unregulated, it means the disclosure format isn't standardized, so you have to do the work a mandated form would otherwise do for you: get the total repayment amount, the holdback or fixed payment, and the estimated repayment period in writing, and turn the factor rate into an actual cost before you compare offers. I'd also watch this list change — five of these eleven states passed their law in the last three years."
Brian Kim reviewed this page's state-by-state legal determinations and general MCA guidance against the cited sources on 2026-08-20. Educational commentary only — not legal, tax, or financial advice, and not an endorsement of any specific provider or offer.
Merchant cash advance state law — common questions
Which states regulate merchant cash advance disclosure? +
As of 2026, 11 states have enacted commercial financing disclosure laws (CFDLs) that reach merchant cash advances and other sales-based financing: California, Connecticut, Florida, Georgia, Kansas, Louisiana, Missouri, New York, Texas, Utah, and Virginia. Each requires an MCA provider to disclose cost-of-financing terms before you sign — the specific format and required figures vary by statute. The other 39 states plus DC have no state-specific MCA disclosure law; MCA there is governed primarily by federal law (FTC oversight of unfair or deceptive practices) and the financing agreement's own terms.
If my state has no MCA disclosure law, am I unprotected? +
Not entirely — federal law still applies everywhere (the FTC and CFPB have both scrutinized MCA marketing, disclosure, and collection practices nationally), and general contract law governs the agreement you sign. But without a state-mandated disclosure format, the burden shifts to you: ask any provider in writing for the total repayment amount, the holdback percentage or fixed payment amount, and the estimated repayment period before signing, and calculate the effective annualized cost yourself — a factor rate alone (e.g., 1.3) doesn't tell you that number.
Why do commercial financing disclosure laws cover merchant cash advances at all, if MCA isn't a loan? +
MCA is structured as a purchase of future receivables, not a loan, which is why it's priced as a factor rate rather than an interest rate/APR and generally falls outside state usury caps. States that have enacted CFDLs (starting with California's SB 1235 in 2018) deliberately wrote them broadly enough to reach "sales-based financing" — MCA was a primary legislative target, since consumer-style APR disclosure doesn't otherwise apply to receivables purchases.
Is New York's merchant cash advance law different from the others? +
New York's Commercial Finance Disclosure Law (S5470-B) sits alongside a separate, specific New York rule: a 2019 amendment to CPLR 3218 that bars confession-of-judgment filings against out-of-state debtors — a direct legislative response to New York state courts historically being the venue MCA providers used to enter fast judgments against merchants nationwide. No other state on this page carries that specific documented COJ history.
Do Texas and Louisiana's new commercial financing disclosure laws already apply to my merchant cash advance? +
Texas's HB 700 (Chapter 398, Texas Finance Code) took effect September 1, 2025, with broker/provider NMLS registration required beginning September 1, 2026. Louisiana's HB 470 took effect August 1, 2025. Both are recently enacted — if you're evaluating an MCA offer in either state now, the disclosure requirement should already apply; ask the provider directly which disclosure format they're using.
How often is this state law table updated? +
This page was last reviewed 2026-08-20. State commercial financing disclosure law is an active legislative area — several of the 11 states on this page enacted their laws within the last three years, and more states introduce similar bills each session. Each row links to the primary source or law-firm client alert it was verified against; if you find a state's status has changed, the statute citation is exactly what to search for.
Sources & methodology
- State commercial financing disclosure law status: primary legislative sources (state legislature bill histories, state regulator industry pages) cross-checked against law-firm client alerts — Mayer Brown, Consumer Financial Services Law Monitor, Husch Blackwell, Hinshaw & Culbertson, Missouri Lawyers Media, National Law Review. Verified 2026-08-19.
- MCA mechanics (factor rate, holdback, "true sale" vs. disguised-loan recharacterization, confession-of-judgment context): general, publicly documented industry and legal facts stated nationally — no per-state factor rate, holdback percentage, or approval volume is published or estimated anywhere on this page (no dataset exists to source that at the state level).
- New York confession-of-judgment fact: 2019 amendment to CPLR 3218 barring COJ filings against out-of-state debtors — a specific, documented legislative response to New York's historical role as the MCA industry's COJ-judgment venue.
- Small-business context referenced in the per-state sections above: SBA Office of Advocacy, 2024 Small Business Profiles (same source already cited across ClearValue Lending's state pages).
- MCA marketing, disclosure, and collection practices are subject to federal oversight regardless of state law — see the Consumer Financial Protection Bureau and FTC.
Editorial disclaimer: Data on this page reflects the sources cited above as of August 20, 2026. State law changes — confirm current status before relying on this page for a transaction. All financing is subject to lender partner approval. ClearValue Lending is a business & personal financing platform — not a lender, broker, or financial advisor. Not legal, tax, or financial advice.
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