H.R. 3244

119 HR 3244 IH: Capital Access for Small Businesses Harmonization Act
 U.S. House of Representatives
 2025-05-07
 text/xml
 EN
 Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
 I  119th CONGRESS  1st Session  H. R. 3244  IN THE HOUSE OF REPRESENTATIVES   May 7, 2025   Mr. Lucas  introduced the following bill; which was referred to the  Committee on Small Business    A BILL
To require certain entities to clearly disclose to small business concerns key information about factoring facility agreements prior to entering such agreements with such concerns, and for other purposes.
1.
Short title
This Act may be cited as the   Capital Access for Small Businesses Harmonization Act   or the   CASH Act  .
2.
Disclosures for small businesses that enter into factoring facility agreements
(a)
In general
Prior to entering into a factoring facility agreement with a small business concern, the provider for such agreement shall provide to such small business concern a written disclosure of the terms of factoring transactions under such agreement if—
(1)
the aggregate dollar amount of factoring transactions authorized under such agreement, including any fees and other charges, is less than $500,000; or
(2)
such agreement does not specify the aggregate dollar amount of factoring transactions authorized under such agreement, such provider and the small business concern reasonably believe that the aggregate dollar amount of factoring transactions under such agreement, including any fees and other charges, will be less than $500,000.
(b)
Disclosure contents
Each disclosure required under subsection (a) with respect to a factoring facility agreement shall include the following:
(1)
The amount or percentage, as applicable, of the difference between the face value of a claim for payment sold in a factoring transaction and the amount the provider will pay to small business concern for such claim under such factoring facility agreement.
(2)
A list of any fees that may be charged under such factoring facility agreement.
(3)
The amount and terms of any reserve under such factoring facility agreement.
(4)
The duration of such factoring facility agreement.
(5)
An example of a factoring transaction under such factoring facility agreement for a claim for payment sold in a factoring transaction with a face value of $10,000 that demonstrates—
(A)
the amount or percentage described in paragraph (1);
(B)
any fees that apply with respect to factoring transactions under such factoring facility agreement;
(C)
the maximum amount of the reserve for such factoring transactions under such factoring facility agreement; and
(D)
the net amount the provider pays to the small business concern for such claim in such factoring transaction.
(c)
Rule of construction
Nothing in this section shall be construed to require a provider to provide to a small business concern the disclosure required under subsection (a) with respect to the modification of a factoring facility agreement.
3.
Federal preemption
No State or political subdivision of a State may impose a requirement that is in addition to, or inconsistent with, the requirements of this Act with respect to requiring providers to make disclosures to small business concerns regarding the terms of factoring transactions under a factoring facility agreement.
4.
Definitions
In this Act:
(1)
Factoring transaction
The term  factoring transaction  means an agreement for the sale of accounts receivable of a small business concern for goods the small business concern has supplied, or services the small business concern has rendered, but for which payment has not yet been made and for which the primary source of repayment to the provider is payment by the account debtor on the account receivable being purchased. For purposes of this Act, the parties’ characterization of a transaction as a purchase and sale of accounts receivable shall be conclusive that the transaction is a true sale and considered a factoring transaction. The term factoring transaction excludes a loan or an advance of money to a small business that is to be repaid by the small business from the proceeds of future accounts receivable which are not in existence when the loan or advance is made.
(2)
Factoring facility agreement
The term  factoring facility agreement  means an agreement between a provider and another entity that establishes the terms of factoring transactions between such provider and another entity.
(3)
Provider
The term  provider  means an individual or entity that—
(A)
is a purchaser in a factoring transaction; and
(B)
is engaged in interstate commerce.
(4)
Reserve
The term  reserve  means the portion of any payment under a factoring transaction that the provider may withhold from the small business concern with respect to claims for payment sold under such factoring transaction, or any portion of such claims, until such claims, or the portion thereof, are paid.
(5)
Small business concern
The term  small business concern  has the meaning given such term under section 3 of the Small Business Act ( 15 U.S.C. 632 ).