Covered Persons

In 2020, the California State Legislature passed the California Consumer Financial Protection Law (CCFPL) as AB 1864 (Limón). Identifying gaps in consumer protection due to strict definitions in existing licensing laws, this law provided the DFPI with the appropriate authority to oversee areas of the financial marketplace previously unregulated in California, including debt settlement and debt relief services, private postsecondary education financing products, and income-based advance products.

The Supervision and Registration of New Covered Persons program is responsible for supervising and regulating providers of these financial activities, including investigating claims of unlawful, unfair, deceptive, and abusive acts or practices, adding even more protections for California consumers.

Who Are Covered Persons?

“Covered persons” refers to any person offering or providing consumer financial products and services to California residents subject to the CCFPL.

These include, but are not limited to, persons offering or providing:

• Debt Settlement Services
• Income-Based Advances
• Private Postsecondary Education Financing
• Student Debt Relief Services

For a full list of consumer financial products and services subject to the CCFPL, please refer to California Financial Code Section 90005 subdivision (k).

Registration

With the approval of DFPI’s first registration regulations in October 2024 by the Office of Administrative Law, the DFPI will now require providers of the following financial products and services to register and submit data to the Department:

• Debt Settlement Services
• Student Debt Relief Services
• Postsecondary Education Financing
• Income-Based Advances (also known as “earned wage access”)

To determine whether your business falls under one of these categories, please refer to the definitions in sections 1001 – 1004 and exemptions in section 1010 of the regulations.  The Department encourages you to seek legal advice if you are unsure whether the rulemaking applies to your business.

DFPI began accepting CCFPL registration applications on November 1, 2024.  Effective February 15, 2025, financial service providers covered by the new registration regulations are required to hold an approved registration or have filed an application for registration prior to the effective date to continue operating legally in the state.  Registration will provide valuable data and insights to help inform changes to consumer protection laws and regulations in the future.

Visit California Consumer Financing Protection law Information for New Registrants for more information.

To receive ongoing updates about current or future registration requirements under the CCFPL, subscribe and choose all notifications for the category “NCP.”

CCFPL Commercial Financing Annual Report Information

On August 2, 2023, the Office of Administrative Law (OAL) approved regulations under the CCFPL concerning the offering and provision of commercial financing and other financial products and services to small businesses, nonprofits, and family farms.  The new rules require annual reporting of commercial financing activity. Learn more about the annual reporting requirements.

References And Additional Information:

• Assembly Bill 1864: California Consumer Financial Protection Law (CCFPL)
• California Consumer Financial Protection Law: Regulations, Legislation, Opinions, and Releases
• California’s Legislature Approves Consumer Protection Bills (American Banker, September 1, 2020)
• California Lawmakers Approve Budget Proposal to Create Financial Watchdog for Consumers (Consumer Reports, September 1, 2020)
• California Seeks New Fintech Regulation in Agency Overhaul (Bloomberg, January 10, 2020)