New York A 11302: Extends the interest rate caps and criminal usury framework to covered services

Bill Text

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A11302 Summary:

BILL NOA11302 

&nbsp

SAME ASSAME AS S10127

&nbsp

SPONSORRules (Rozic)

&nbsp

COSPNSR

&nbsp

MLTSPNSR

&nbsp

Amd §5-501, Gen Ob L; amd §14-a, Bank L; amd §§190.40 & 190.42, Pen L

&nbsp

Extends the interest rate caps and criminal usury framework to covered services including but not limited to, retail installment contracts, merchant cash advances, invoice financing, revenue-based financing, or any transaction that in substance functions as the advance of funds in exchange for a future payment or obligation, regardless of the label assigned to such transaction.

Go to top A11302 Actions:

BILL NOA11302 

&nbsp

05/11/2026referred to judiciary

Go to topA11302 Committee&nbspVotes:

Go to topA11302 Floor&nbspVotes:

There are no Assembly votes for this bill in this legislative session.

Go to topA11302 Text:

 STATE OF NEW YORK
 ________________________________________________________________________

 11302

 IN ASSEMBLY

 May 11, 2026
 ___________

 Introduced by COMMITTEE ON RULES -- (at request of M. of A. Rozic) --
 read once and referred to the Committee on Judiciary

 AN ACT to amend the general obligations law, the banking law and the
 penal law, in relation to extending the interest rate caps and crimi-
 nal usury framework to covered services

 The People of the State of New York, represented in Senate and Assem-
 bly, do enact as follows:

 1 Section 1. Section 5-501 of the general obligations law is amended by
 2 adding a new subdivision 1-a to read as follows:
 3 1-a. For the purposes of this section, the term "covered service"
 4 shall mean short-term financing contingent upon the payment of interest,
 5 fees, tips, renewal charges, ancillary charges or any payment made in
 6 connection with a transaction, including but not limited to, retail
 7 installment contracts, merchant cash advances, invoice financing, reven-
 8 ue-based financing, or any transaction that in substance functions as
 9 the advance of funds in exchange for a future payment or obligation,
 10 regardless of the label assigned to such transaction.
 11 § 2. Subdivision 2 of section 5-501 of the general obligations law, as
 12 amended by chapter 883 of the laws of 1980 and as further amended by
 13 section 104 of part A of chapter 62 of the laws of 2011, is amended to
 14 read as follows:
 15 2. No person or corporation shall, directly or indirectly, charge,
 16 take or receive any money, goods or things in action as interest on the
 17 covered service, loan or forbearance of any money, goods or things in
 18 action at a rate exceeding the rate [above prescribed] as prescribed in
 19 subdivision one of this section. The amount charged, taken or received
 20 as interest shall include any and all amounts paid or payable, directly
 21 or indirectly, by any person, to or for the account of the lender in
 22 consideration for making the covered service, or the loan or forbearance
 23 as defined by the superintendent of financial services pursuant to
 24 subdivision three of section fourteen-a of the banking law, except such
 25 fee as may be fixed by the commissioner of taxation and finance as the
 26 cost of servicing loans made by the property and liability insurance
 27 security fund.

 EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD15589-02-6

 A. 11302 2

 1 § 3. Subdivision 2 of section 14-a of the banking law, as amended by
 2 chapter 155 of the laws of 2012, is amended to read as follows:
 3 2. The rate of interest as so prescribed under this section shall
 4 include as interest any and all amounts paid or payable, directly or
 5 indirectly, by any person, to or for the account of the lender in
 6 consideration for the making of a covered service, as defined by section
 7 5-501 of the general obligations law, or loan or forbearance as defined
 8 by the superintendent, pursuant to subdivision three of this section.
 9 § 4. Section 190.40 of the penal law, as amended by chapter 424 of the
 10 laws of 1976, is amended to read as follows:
 11 § 190.40 Criminal usury in the second degree.
 12 A person is guilty of criminal usury in the second degree when, not
 13 being authorized or permitted by law to do so, [he] such person knowing-
 14 ly charges, takes or receives any money or other prope