Connecticut 2026 Session Status: Passed House Bipartisan · 66 D · 22 R cosponsors

HB 5211 — AN ACT CONCERNING COMMERCIAL FINANCING.

Last action — MATTER PASS RETAINED

  1. ✓
    Introduced
  2. ✓
    In Committee
  3. 3
    Passed House
  4. 4
    Passed Senate
  5. 5
    To Executive
  6. 6
    Enacted

This bill has passed the House. Introduced February 18, 2026. It now moves to the second chamber.

Next likely step: consideration and a floor vote in the Senate.

Odds of enactment

High chance

Based on the sponsor, cosponsors, and committee posture, this bill has a high chance of becoming law.

Upgrade to see the exact probability and what's driving it.

A statistical estimate from our own model of past outcomes — an insight, not a guarantee. Policymaking is volatile.

Prognosis

Advancing 54% · moderate confidence

  • Passed House

    Current position in the legislative process.

  • 88 sponsors

    88 primary, 0 co-sponsors signed on.

  • Bipartisan support

    Sponsored across 2 parties (66 D · 22 R) — cross-party backing.

Based on stage, sponsorship breadth, committee status, recorded votes, and cross-state momentum — a description of the observable signals, not a prediction.

Bill Text

What changed in the latest version

273 added · 127 removed

Plain-language change summary

The latest version of Bill HB 5211 has changed the effective date for certain provisions from October 1, 2026, to July 1, 2027. Additionally, it simplifies the requirements for providers of sales-based financing by removing the obligation to notify the Banking Commissioner about their chosen methods for calculating annual percentage rates. These changes matter because they allow businesses more time to prepare for compliance and reduce regulatory burdens, helping them focus on serving their customers better.

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Latest
General Assembly Substitute Bill No.
House of Representatives File No.
5211 February Session, 2026 AN ACT CONCERNING COMMERCIAL FINANCING.
729 General Assembly February Session, 2026Reprint of File No.
134) Substitute House Bill No.
5211 As Amended by House Amendment Schedule "A" Approved by the Legislative Commissioner April 28, 2026 AN ACT CONCERNING COMMERCIAL FINANCING.
Section 36a-861 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2026):
Section 36a-861 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2027):
(3) "Finance charge" means the cost of financing expressed as a dollar amount, including (A) any charge payable directly or indirectly by the recipient and imposed directly or indirectly by the provider as an incident to, or a condition of, the extension of financing, and (B) all charges that would be included under the definition of "finance charge" in 12 CFR 1026.4, as amended from time to time, as if the transaction were subject to said section;
(3) "Finance charge" means the cost of financing expressed as a dollar sHB5211 / File No.
LCO 1 of 7 Substitute Bill No.
729 sHB5211 File No.
5211 (4) "Financer" means a person who provides, or will provide, commercial financing to a recipient;
729 amount, including (A) any charge payable directly or indirectly by the recipient and imposed directly or indirectly by the provider as an incident to, or a condition of, the extension of financing, and (B) all charges that would be included under the definition of "finance charge" in 12 CFR 1026.4, as amended from time to time, as if the transaction were subject to said section;
(4) "Financer" means a person who provides, or will provide, commercial financing to a recipient;
(6) "Provider" means a person who extends a specific offer of commercial financing to a recipient and includes, unless otherwise exempt under this section, a commercial financing broker, but does not include any (A) bank, out-of-state bank, bank holding company, Connecticut credit union, federal credit union, out-of-state credit union or any subsidiary or affiliate of the foregoing, as those terms are defined in section 36a-2, (B) person acting in such person's capacity as a technology services provider to an entity exempt under this section for use as part of the exempt entity's commercial financing program, provided such person has no interest, arrangement or agreement to purchase any interest in the commercial financing extended by the exempt entity in connection with such program, (C) lender regulated under the federal Farm Credit Act, 12 USC 2001 et seq., as amended from time to time, (D) person or provider who extends or brokers a commercial financing transaction secured by real property, (E) person or provider who extends or brokers a lease, as defined in section 42a- 2A-102, (F) person or provider who extends or brokers a purchase- money obligation, as defined in section 42a-9-103a, (G) person or provider who extends not more than five commercial financing transactions in this state in a twelve-month period, (H) person or provider who extends or brokers a commercial financing transaction entered into pursuant to a commercial financing agreement or commercial open-end credit plan of at least fifty thousand dollars, in which the recipient is (i) a dealer, as defined in section 14-1, or an affiliate of such a dealer, or (ii) a motor vehicle rental company, or an affiliate of such a company, or (I) person or provider who extends or brokers a commercial financing transaction in connection with the sale of products or services that such person or provider manufactures, LCO 2 of 7 Substitute Bill No.
(6) "Provider" means a person who extends a specific offer of commercial financing to a recipient and includes, unless otherwise exempt under this section, a commercial financing broker, but does not include any (A) bank, out-of-state bank, bank holding company, Connecticut credit union, federal credit union, out-of-state credit union or any subsidiary or affiliate of the foregoing, as those terms are defined in section 36a-2, (B) person acting in such person's capacity as a technology services provider to an entity exempt under this section for use as part of the exempt entity's commercial financing program, provided such person has no interest, arrangement or agreement to purchase any interest in the commercial financing extended by the exempt entity in connection with such program, (C) lender regulated under the federal Farm Credit Act, 12 USC 2001 et seq., as amended from time to time, (D) person or provider who extends or brokers a commercial financing transaction secured by real property, (E) person or provider who extends or brokers a lease, as defined in section 42a- 2A-102, (F) person or provider who extends or brokers a purchase- money obligation, as defined in section 42a-9-103a, (G) person or provider who extends not more than five commercial financing transactions in this state in a twelve-month period, (H) person or provider who extends or brokers a commercial financing transaction sHB5211 / File No.
5211 licenses or distributes, or whose parent company, subsidiary or affiliate manufactures, licenses or distributes;
729 sHB5211 File No.
729 entered into pursuant to a commercial financing agreement or commercial open-end credit plan of at least fifty thousand dollars, in which the recipient is (i) a dealer, as defined in section 14-1, or an affiliate of such a dealer, or (ii) a motor vehicle rental company, or an affiliate of such a company, or (I) person or provider who extends or brokers a commercial financing transaction in connection with the sale of products or services that such person or provider manufactures, licenses or distributes, or whose parent company, subsidiary or affiliate manufactures, licenses or distributes;
Section 36a-863 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2026):
Section 36a-863 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2027):
(2) The disbursement amount, which is the amount paid to the recipient or on the recipient's behalf, excluding any finance charges that are deducted or withheld at disbursement.
sHB5211 / File No.
729 sHB5211 File No.
729 (2) The disbursement amount, which is the amount paid to the recipient or on the recipient's behalf, excluding any finance charges that are deducted or withheld at disbursement.
(4) The estimated annual percentage rate, using the words "annual LCO 3 of 7 Substitute Bill No.
(4) The estimated annual percentage rate, using the words "annual percentage rate" or the abbreviation "APR", expressed as a yearly rate, inclusive of any fees and finance charges, and determined in accordance with 12 CFR 1026.22, as amended from time to time, based on the estimated term of repayment and the projected periodic payment amounts.
5211 percentage rate" or the abbreviation "APR", expressed as a yearly rate, inclusive of any fees and finance charges, and determined in accordance with 12 CFR 1026.22, as amended from time to time, based on the estimated term of repayment and the projected periodic payment amounts.
The provider shall provide notice to the Banking Commissioner, in a form and manner prescribed by the commissioner, disclosing which method the provider intends to use to determine the estimated annual percentage rate in all instances of sales-based financing offered by the provider.
The provider shall use either such safe harbor method or such underwriting method to determine the estimated annual percentage rate in all instances of sales-based financing offered by the provider.
The report shall contain such information as the commissioner may prescribe as necessary or appropriate for the purpose of determining whether the deviation between the estimated annual percentage rates and the actual retrospective annual percentage rates of completed transactions was reasonable.
The sHB5211 / File No.
The commissioner shall establish the LCO 4 of 7 Substitute Bill No.
729 sHB5211 File No.
5211 method of reporting and may, upon a finding by the commissioner that the use of projected sales or revenue volume by the provider has resulted in an unacceptable deviation between the disclosed and actual annual percentage rates, require the provider to use the safe harbor method.
729 report shall contain such information as the commissioner may prescribe as necessary or appropriate for the purpose of determining whether the deviation between the estimated annual percentage rates and the actual retrospective annual percentage rates of completed transactions was reasonable.
The commissioner shall establish the method of reporting and may, upon a finding by the commissioner that the use of projected sales or revenue volume by the provider has resulted in an unacceptable deviation between the disclosed and actual annual percentage rates, require the provider to use the safe harbor method.
[(8)] (9) (A) Any finance charge the recipient will be required to pay if the recipient elects to pay off or refinance the commercial financing prior to full repayment, other than interest accrued since the recipient's last payment, and the percentage of any unpaid portion of such finance charge and the maximum dollar amount of such finance charge the LCO 5 of 7 Substitute Bill No.
sHB5211 / File No.
5211 recipient will be required to pay;
729 sHB5211 File No.
729 [(8)] (9) (A) Any finance charge the recipient will be required to pay if the recipient elects to pay off or refinance the commercial financing prior to full repayment, other than interest accrued since the recipient's last payment, and the percentage of any unpaid portion of such finance charge and the maximum dollar amount of such finance charge the recipient will be required to pay;
Section 36a-866 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2026):
(a) Nothing in this section or sections 36a-861 to 36a-865, inclusive, as amended by this act, shall prevent a provider from providing or disclosing additional information concerning commercial financing offered to a recipient, provided such additional information shall not be disclosed as part of any disclosure required pursuant to this section or sections 36a-861 to 36a-865, inclusive, as amended by this act.
(b) If, after extending a specific offer to a recipient, a provider discloses to therecipient any charge, pricing metric or financing amount for such specific offer, the provider shall also disclose to the recipient the annual percentage rate of the specific offer by using the words "annual percentage rate" or the abbreviation "APR".
(c) In any communication with a recipient, a provider shall not use the term "interest" or "rate" in a deceptive way that could reasonably result in the recipient being misled.
For purposes of this subsection, a communication by a provider that uses the term "interest" or "rate" shall not be deemed to be deceptive if the metric of financing cost expressed in the communication is an annual interest rate or annual percentage rate that is either (1) fixed, or (2) floating and expressed as a margin over LCO 6 of 7 Substitute Bill No.
5211 an index rate.
Sec.
4.
or (2) nondisclosure provision requiring a recipient to maintain the confidentiality of the commercial financing contract or its terms.
or (2) nondisclosure provision requiring a recipient to maintain the sHB5211 / File No.
Any provision prohibited by this subsection that is included in a commercial financing contract shall be unenforceable.
729 sHB5211 File No.
729 confidentiality of the commercial financing contract or its terms.
Any provision prohibited by this subsection that is included in a commercial financing contract shall be void.
Section 1 October 1, 2026 36a-861 Sec.
Section 1 July 1, 2027 36a-861 Sec.
2 October 1, 2026 36a-863 Sec.
2 July 1, 2027 36a-863 Sec.
Show all 113 changed rows (73 more)
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3 October 1, 2026 36a-866 Sec.
3 October 1, 2026 36a-868 sHB5211 / File No.
4 October 1, 2026 36a-868 BA Joint Favorable Subst.
729 7 sHB5211 File No.
JUD Joint Favorable LCO 7 of 7
729 The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and do not represent the intent of the General Assembly or either chamber thereof for any purpose.
In general, fiscal impacts are based upon a variety of informational sources, including the analyst’s professional knowledge.
Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.
OFA Fiscal Note State Impact:
Agency Affected Fund-Effect FY 27 $ FY 28 $ Banking Dept.
BF - Revenue None Minimal Gain Banking Dept.1 BF - Potential None 167,400 Cost Note:
BF=Banking Fund Municipal Impact:
None Explanation The bill:
(1) requires certain providers of sales-based financing to disclose an estimated annual percentage rate (APR) for all sales-based financing transactions and comply with other new requirements, and (2) expands the types of such providers that must register with the Department of Banking.
The bill results in both a potential cost of up to $167,400 and a minimal annual revenue gain to the Banking Fund, beginning in FY 28 and annually thereafter.
The bill's potential cost is associated with one new financial examiner that may be needed if the bill's changes result in a significantly higher volume or complexity of consumer complaints.
There were 10 complaints to the banking department regarding sales-based financing in the last year.
The fringe benefit costs for employees funded out of other appropriated funds are budgeted within the fringe benefit account of those funds, as opposed to the fringe benefit accounts within the Office of the State Comptroller.
The estimated active employee fringe benefit cost associated with most personnel changes for other appropriated fund employees is 85.92% of payroll in FY 27.
sHB5211 / File No.
729 sHB5211 File No.
729 Should this position be needed, the annual cost is expected to be $90,000 in salary and $77,400 in fringe benefits, beginning in FY 28.
Other expenses for the new position would total $2,000 upon hiring, for a laptop and related supplies.
The bill also results in revenue gain to the Banking Fund of $1,000 per each new registration and a $500 annual fee, beginning in FY 28.
The number of new entities registering is expected to be low, resulting in minimal revenue gain.
House "A" eliminates the original bill and its associated fiscal impact, and results in the impact described above.
The Out Years The annualized ongoing fiscal impact identified above would continue into the future subject to:
(1) the volume of complaints associated with the bill's new requirements on sales-based financing providers, (2) the number of newly registered commercial financing providers, and (3) inflation.
sHB5211 / File No.
729 9 sHB5211 File No.
729 OLR Bill Analysis sHB 5211 (as amended by House "A")* AN ACT CONCERNING COMMERCIAL FINANCING.
SUMMARY This bill makes the following changes to the law on required disclosures for sales-based financing transactions and registration of the financing providers and brokers (see BACKGROUND):
1.
eliminates the $250,000 threshold above which transactions are exempt from having the disclosures, thus making all sales-based financing transactions subject to the law’s requirements and requiring their providers and brokers to be registered with the banking department;
2.
requires financing providers to disclose, when extending a specific financing offer, an estimated annual percentage rate (APR);
3.
relieves the providers from liability if an actual APR charged differs from the disclosed estimated APR;
and 4.
prohibits these financing contracts entered into on or after October 1, 2026, from having a nondisclosure provision that requires therecipient to keep the contract confidential and makes the provision void if it is included in the contract.
Under existing law, which applies to the bill’s provisions, violations of the financing disclosure requirements are subject to various enforcement actions by the banking commissioner, such as (1) registration suspension or revocation;
(2) civil penalties of up to $100,000 per violation;
or (3) injunctive relief (CGS § 36a-872).
sHB5211 / File No.
729 10 sHB5211 File No.
729 The bill also makes technical and conforming changes.
*House Amendment “A” (1) delays, from October 1, 2026, to July 1, 2027, the effective date for (a) subjecting providers of larger financing transactions to the law’s registration and disclosure requirements and (b) requiring the estimated APR disclosures;
(2) removes requirements in the underlying bill for providers to notify the banking department about which method they choose to calculate estimated APR and disclose an APR when giving certain information to the financing recipient after extending a specific offer;
(3) removes an underlying provision on deceptive use of “interest” or “rate” in communications;
and (4) makes the contract nondisclosure provisions void, rather than unenforceable.
EFFECTIVE DATE:
July 1, 2027, except the nondisclosure provision prohibition for the financing contracts is effective October 1, 2026.
§ 2 — ESTIMATED APR DISCLOSURE Under existing law, lenders providing this financing must generally disclose to applicants information such as the financing amount, payment amount, finance charges and other potential fees, term, and any prepayment amount.
The banking commissioner sets the format for providing the disclosures.
The bill additionally requires them to disclose the estimated APR (using the words “annual percentage rate” or the APR abbreviation).
The rate must be shown as a yearly rate, including any fees and finance charges and calculated in accordance with federal regulations under the federal Truth in Lending Act (12 C.F.R.
§ 1026.22), based on the estimated term of repayment and projected periodic payment amounts calculated using the recipient’s projected sales or revenue.
Methods for Calculating Projected Sales or Revenue Volume The bill allows the projected sales or revenue volume to be calculated using either the “safe harbor” method or the “underwriting” method.
But it requires the provider to use either the safe harbor method or the sHB5211 / File No.
729 11 sHB5211 File No.
729 underwriting method to calculate the estimated APR in all sales-based financing offerings it makes.
Safe Harbor Method.
Under the safe harbor method, the provider must use an average of the recipient’s sales or revenue volume during a fixed period.
The period must be (1) from the 12 months immediately before the specific offer, (2) between three and 12 consecutive months in length, and (3) used for all disclosures of sales-based financing products the provider offers.
Underwriting Method.
Under the underwriting method, the provider must use the projected sales or revenue volume that it relied on to underwrite the specific offer.
Providers choosing this method must participate in a review process the commissioner sets.
Beginning October 1, 2027, they must annually report data to the commissioner on the (1) estimated APRs they disclosed to recipients and (2) actual retrospective APRs of completed transactions.
Under the bill, the report must have information that the commissioner may require to determine if the deviation between the estimated and actual retrospective APRs was reasonable.
The commissioner must establish the reporting method and may, upon finding that the use of projected sales or revenue volume resulted in an unacceptable deviation between the estimated and actual APRs, require the provider to use the safe harbor method instead.
As part of making this finding, the commissioner may consider unusual and extraordinary circumstances affecting the provider’s deviation between estimated and actual APRs.
BACKGROUND Sales-Based Financing By law, sales-based financing is a transaction in which the recipient repays over time (1) as a percentage of sales or revenue, and the payment may increase or decrease according to the recipient’s sales or sHB5211 / File No.
729 12 sHB5211 File No.
729 revenue, or (2) according to a mechanism where repayment is as a fixed amount but with a reconciliation process that adjusts to an amount that is a percentage of sales or revenue.
COMMITTEE ACTION Banking Committee Joint Favorable Substitute Yea 9 Nay 4 (03/10/2026) Judiciary Committee Joint Favorable Yea 35 Nay 5 (04/10/2026) sHB5211 / File No.
729 13
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Action History

  1. MATTER PASS RETAINED

  2. SEN. ADOPTED HO. AMEND. SCH. A

  3. FILE NO. 729

  4. SENATE CALENDAR NUMBER 466

  5. FAV. RPT., TAB. FOR CAL., SEN.

  6. IMMEDIATE TRANSMITTAL TO THE SENATE

  7. HOUSE PASSED, HOUSE AMEND. SCH. A

  8. HOUSE REJECTED HOUSE AMEND. SCH. B

  9. HOUSE ADOPTED HOUSE AMEND. SCH. A

  10. TABLED FOR HOUSE CALENDAR

  11. NO NEW FILE BY COMM. ON Judiciary

  12. RPTD. OUT OF LCO

  13. FILED WITH LCO

  14. Joint Favorable

  15. REF. BY HOUSE TO COMMITTEE ON Judiciary

  16. FILE NO. 134

  17. HOUSE CALENDAR NUMBER 114

  18. FAV. RPT., TABLED FOR HOUSE CALENDAR

  19. RPTD. OUT OF LCO

  20. REFERRED TO Office of Legislative Research AND Office of Fiscal Analysis 03/23/26

  21. FILED WITH LCO

  22. Joint Favorable Substitute

  23. PUBLIC HEARING 0224

  24. REF. TO JOINT COMM. ON Banking

Sponsors

Sponsorship breakdown

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88 sponsors · 0 co-sponsors · 99 not signed on

Sponsors (88)

Co-sponsors (0)

None.

Not signed on (99)

99 members have not signed on to this bill.

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"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.

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Frequently asked questions

Who sponsors HB 5211?
HB 5211 is sponsored by Tony J. Scott (Republican), William Pizzuto (Republican), Stephen R. Meskers (Democratic), Kaitlyn Shake (Democratic), MD Rahman (Democratic), Joseph P. Gresko (Democratic), Matthew L. Lesser (Democratic), Kadeem Roberts (Democratic), Renee LaMark Muir (Democratic), Ceci Maher (Democratic), Jason Rojas (Democratic), Hubert D. Delany (Democratic), Corey P. Paris (Democratic), Jason Doucette (Democratic), Patricia Billie Miller (Democratic), Tom Delnicki (Republican), Vincent J. Candelora (Republican), Nick Gauthier (Democratic), David DeFronzo (Democratic), Kate Farrar (Democratic), Jillian Gilchrest (Democratic), Hector Arzeno (Democratic), Michael "MJ" Shannon (Democratic), Joshua M. Hall (Democratic), Matt Blumenthal (Democratic), William Heffernan (Democratic), Gary A. Turco (Democratic), Michael DiGiovancarlo (Democratic), Savet Constantine (Democratic), Nicholas Menapace (Democratic), Michael D. Quinn (Democratic), Patrick E. Callahan (Republican), Mitch Bolinsky (Republican), Tom O'Dea (Republican), Jonathan Jacobson (Democratic), David Rutigliano (Republican), Seth Bronko (Republican), Maria P. Horn (Democratic), Tony Hwang (Republican), Kenneth Gucker (Democratic), Gregory Haddad (Democratic), Kurt Vail (Republican), Aundre Bumgardner (Democratic), Jaime S. Foster (Democratic), Laurie Sweet (Democratic), Trenee McGee (Democratic), Ronald A. Napoli (Democratic), Roland J. Lemar (Democratic), Tim Ackert (Republican), Kara Rochelle (Democratic), John-Michael Parker (Democratic), Anthony L. Nolan (Democratic), Steven Winter (Democratic), Aimee Berger-Girvalo (Democratic), Anne M. Hughes (Democratic), Farley Santos (Democratic), Patrick S. Boyd (Democratic), Christopher Poulos (Democratic), Jill Barry (Democratic), Ben McGorty (Republican), Irene M. Haines (Republican), Chris Stewart (Republican), James Sanchez (Democratic), Susan M. Johnson (Democratic), Fred Gee (Democratic), Kevin Brown (Democratic), John Santanella (Democratic), Marcus Brown (Democratic), Antonio Felipe (Democratic), Kai J. Belton (Democratic), Christopher Rosario (Democratic), John E. Piscopo (Republican), Tami Zawistowski (Republican), Patrick Biggins (Democratic), Dave W. Yaccarino (Republican), Greg S. Howard (Republican), Arnold Jensen (Republican), Rebecca Martinez (Democratic), Sarah Keitt (Democratic), Daniel Gaiewski (Democratic), Chris Aniskovich (Republican), Maryam Khan (Democratic), Kerry S. Wood (Democratic), Joseph H. Zullo (Republican), Cristin McCarthy Vahey (Democratic), Eilish Collins Main (Democratic), and Julio A. Concepcion (Democratic).
What is the current status of HB 5211?
This bill has passed the House. Introduced February 18, 2026. It now moves to the second chamber.
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