Postsecondary Education Financing

Education financing is defined as credit extended for the purpose of funding the cost of attendance at an institution that provides postsecondary education, which is not limited to programs where a degree or certificate is received upon completion.  This includes agreements with income-driven repayment provisions based on the consumer’s income or employment status.

For applicable definitions to determine if you are providing education financing, see Financial Code sections 90005(g) and (h), and California Code of Regulations, title 10, sections 1000(f) and 1003.

A licensee of any state agency other than the Department is not subject to registration under the CCFPL to the extent it is acting under the authority of the other state agency’s license.

A licensee offering to provide or providing education financing within the scope of its California Financing Law (CFL) or Student Loan Servicing Act (SLSA) license is exempt from CCFPL registration requirements if the licensee has met the requirements of California Code of Regulations, title 10, sections 1430.1 or 2044.1, respectively.

In addition, the registration requirement does not apply to a public postsecondary institution or a private nonprofit postsecondary institution, when offering or providing education financing for the purpose of obtaining postsecondary education at that institution.

You may also be exempt from registration as a seller of nonfinancial goods or services if you make 25 or fewer credit transactions per year, the bona fide extension of credit is to a consumer for the acquisition of a nonfinancial good or service, and the credit extended meets other criteria as specified in Financial Code section 90006(e).

For more information, see Financial Code section 90002 and California Code of Regulations, title 10, section 1010.

For more information, see Education Code section 94918.5.

Yes. Tuition payment plans, even those that are interest-free or finance-charge-free, constitute education financing under the CCFPL, and you are required to register if you provide such products. Education financing is credit extended for the purpose of funding postsecondary education and the cost of attendance at a postsecondary educational institution. Interest or finance charges are not required for a product to meet the definition of credit under the CCFPL and its accompanying regulations. Credit is the right granted by a person to another person to defer payment of a debt, incur debt and defer its payment, or purchase property or services and defer payment for those purchases.

For these and other definitions, see Financial Code sections 90005(g) and (h), and California Code of Regulations, title 10, sections 1000(f) and 1003.

No.  Prepaid or “pay-as-you-go” tuition payment options require students to pay in advance of the upcoming portion of the academic term or course, and students may withdraw any time without penalty and no obligation to pay for remaining periods.

Education financing involves an extension of credit.  Where a student receives gift funds with no repayment or expectation of repayment, the funding would likely not be an extension of credit.  Title IV financial aid is not provided by educational institutions and therefore does not trigger registration requirements.  If your institution does not provide or offer to provide “education financing” as defined by the regulations, then it is not required to register under the CCFPL.

Unless exempted, any person that engages in the business of providing or offering to provide education financing to California residents must register with the Department, as required by the CCFPL. This includes third parties that engage in the business of education financing through partnerships with postsecondary educational institutions. Public or nonprofit postsecondary educational institutions that meet the requirements of section 1010(b)(2) of the regulations are exempt from registration, but the exemption does not extend to any third-party partners.

It is recommended that you notify your third-party partners of the registration requirements so they can determine whether they are subject to registration.

For more information, see California Code of Regulations, title 10, section 1010(b)(2).

You may submit general information about the educational program and tuition in your Business Plan; however, the registration is related to education financing.  You are required to include details about the type of education financing offered or provided to California residents (e.g., retail installment contracts, tuition payment plans, income-share agreements) and any associated charges (e.g., interest, enrollment fees, late fees).

The registration is related to the education financing, not the educational program.  Gross income from education financing includes interest, fees, or other forms of costs charged in connection with providing education financing to California residents, as described in the definition of “charges” in California Code of Regulations, title 10, section 1003(a).  Tuition and other costs or fees related to an educational program that are charged to all students, including those who don’t receive financing, should not be reported as gross income from education financing in the registration application or future annual reports.

Yes.  An education financing registrant is required to file an annual report on or before March 15 of each calendar year, starting in 2026.

Yes. While CFL and SLSA licensees may be exempt from CCFPL registration when offering education financing within the scope of their licenses, they are still required to file the CCFPL Education Financing annual report, which is separate from the annual reports required under the CFL and SLSA.