Assembly committee advances four consumer-finance bills on disclosures, enforcement and home-improvement lending

The Assembly Banking and Finance Committee on Oct. 26 advanced four Senate measures that would change how consumer and small‑business financial products are regulated and enforced in California.

The committee voted to move SB 97 (updates to the digital financial‑assets licensing law), SB 362 (strengthening small‑business financing disclosures), SB 784 (new consumer protections and lender‑liability changes for contractor‑funded home improvement projects) and SB 825 (clarifying state enforcement authority for consumer financial laws) to subsequent committees for further consideration.

Why it matters: the bills aim to tighten disclosures and enforcement where committee members and witnesses said firms and third‑party contractors have left consumers — especially seniors, non‑English speakers and small businesses — exposed to costly or opaque financing terms. Committee members and authors said the measures are intended to complement federal law and to give California regulators tools to act if federal enforcement recedes.

SB 97: digital‑asset licensing updates Sen. Grayson presented SB 97 as a narrow set of clarifications and technical updates to the state's 2023 digital financial‑assets licensing framework. Supporters who spoke said the amendments reflect stakeholder consensus and preserve state licensing flexibility should Congress act. Jamie Minor of the California Blockchain Advocacy Coalition and Cassie Gilson (testifying on behalf of Andreessen Horowitz) expressed conditional support and asked for continued collaboration on scope and applicability. Robert Harrell of the Consumer Federation of California also testified in support, noting a transparent stakeholder process.

SB 362: stronger disclosures for small businesses Sen. Grayson said SB 362 builds on California's 2018 price‑disclosure law to ensure small businesses receive clear, consistent pricing information during marketing and application so they can compare offers — for example, by using APR as a common comparison metric. Heidi Pickman of the CAMEO Network described a merchant cash‑advance example where a small business faced unaffordable monthly payments and later successfully refinanced; she said not all small businesses have that option. Louis Kidditz Peck of the Responsible Business Lending Coalition and others spoke in support. Opponents representing revenue‑based financiers warned that a requirement to provide APR in any communication (not just a formal offer) could impede informal negotiations and recommended a New York model that clarifies when a rate must be labeled an APR.

SB 784: contractor‑funded home‑improvement financing and consumer safeguards Sen. Durazo described SB 784 as targeting a niche of door‑to‑door contractor‑funded loans that she and witnesses said have produced widespread consumer harm. The bill, as amended in the committee, adds protections including a pre‑closing confirmation call between lender and borrower, requirements that consumers have access to loan and project documents, expanded cancellation time, and added transparency around so‑called dealer fees that often inflate a loan's effective cost. Natasha Blazer of Housing and Economic Rights Advocates and Andrew Kushner of the Center for Responsible Lending described frequent patterns of doorstep sales, electronic signature fraud, and loans tied to incomplete or nonfunctional work. Rebecca May of the Contractors State Licensing Board explained the board has seen a surge in complaints and has created an enforcement unit.

Industry witnesses described concerns and sought carve‑outs or clarifications. Solar industry associations (which moved to neutral with committee amendments) and lenders including Wells Fargo, California Bankers Association, and community banks raised concerns that some multipurpose or non‑door‑to‑door lending products could be unintentionally swept in. The author said she accepted major concessions and committed to continued negotiations to avoid harming legitimate lenders while protecting consumers.

SB 825: state enforcement authority for consumer financial protections Sen. Lamone (designee) said SB 825 would ensure the Department of Financial Protection and Innovation (DFPI) can bring actions under state law to remedy unfair, deceptive or abusive practices (UDAAP/UDAAP‑style claims) without depending on parallel federal enforcement. Andrew Kushner and Ed Howard testified the bill does not create new substantive obligations but clarifies that DFPI may seek remedies directly under state law, a change proponents said is timely given recent federal retrenchment by the Consumer Financial Protection Bureau. Banking groups and trade associations opposed or sought amendments, arguing the change could duplicate or complicate existing enforcement tools and that coordination with federal regulators remains important.

Votes at a glance - SB 97 (digital financial assets law updates): committee motion to 'do pass and refer to Committee on Privacy and Consumer Protection; outcome: moved out of committee; roll left open for absent members (committee record noted the bill was on call and roll left open). - SB 362 (small‑business financing disclosures): motion 'do pass and refer to Committee on Judiciary; outcome: passed the committee; committee left the roll open for absent members. - SB 784 (home‑improvement financing consumer protections): motion 'do pass and refer to Committee on Judiciary; outcome: passed the committee; the author and opponents agreed to continue negotiations as bill advances. - SB 825 (state enforcement authority for financial consumer protection): motion 'do pass and refer to Committee on Appropriations; outcome: passed the committee.

What comes next Each bill will proceed to the committee named in the motion for deeper policy or fiscal review. Committee members and authors said they expect additional amendments in later committees, particularly on SB 784 (to address bank and industry carve‑outs) and SB 825 (to refine coordination with federal regulators).

Reporting details and context Witnesses at the hearing included advocacy groups, industry trade groups, consumer‑protection organizations and lenders. Committee members asked for clarifications about the bills' scope (for example, when a loan is considered a "home solicitation sale" and how dealer fees are disclosed), and authors repeatedly committed to continue negotiating technical fixes.

The committee hearing record shows the Assembly committee advanced a package of bills aimed at increasing disclosure and enforcement tools for consumer and small‑business finance while directing staff and parties to continue drafting clearer, narrower exemptions where necessary to avoid unintended consequences for mainstream lenders and legitimate contractors.