BUY-NOW-PAY-LATER ACT

Illinois General Assembly - Full Text of SB3561

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SB3561 Enrolled
LRB104 20058 SPS 33509 b
1

AN ACT concerning business.

2

Be it enacted by the People of the State of Illinois,
3
represented in the General Assembly:

4

Section 1.
Short title.
This Act may be cited as the
5
Buy-Now-Pay-Later Loan Consumer Protection Act.

6

Section 2.
Definitions.
As used in this Act:
7

"Applicant" means a person who has submitted an
8
application for a license under this Act.
9

"Annual percentage rate" means the nominal annual
10
percentage rate of finance charge determined in accordance
11
with the actuarial method of computation with an accuracy at
12
least to the nearest 1/4 of 1% or, at the option of the
13
licensee by application of the federal rule, so that it may be
14
disclosed with an accuracy at least to the nearest 1/4 of 1%.
15

"Buy-now-pay-later loan" or "loan" means closed-end credit
16
provided to a consumer at the time of a transaction in
17
connection with the consumer's particular purchase of goods or
18
services that:
19

(1) is payable in 4 or fewer installments; or
20

(2) has a term of 120 days or less.
21

"Buy-now-pay-later loan" or "loan" includes any other loan
22
identified by the Secretary by rule. "Buy-now-pay-later loan"
23
or "loan" also includes (i) a buy-now-pay-later loan payable

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1
in one or more installments without any interest or finance
2
charge and (ii) a buy-now-pay-later loan with either interest
3
or finance charges or both.
4

"Buy-now-pay-later loan" or "loan" does not include credit
5
where the creditor is the seller of the goods or services,
6
unless it is credit pursuant to an agreement where, at a
7
consumer's request, the creditor purchases specific goods or
8
services from a seller and resells the specific goods or
9
services to the consumer on closed-end credit.
10
"Buy-now-pay-later loan" or "loan" also does not include (i) a
11
loan for a motor vehicle or (ii) a residential mortgage loan,
12
as that term is defined in Section 1-4 of the Residential
13
Mortgage License Act of 1987. "Buy-now-pay-later loan" or
14
"loan" also does not include any loan to a seller of goods or
15
services for the purchase of inventory for sale or resale by
16
the seller of goods or services in the normal course of
17
business.
18

"Consumer" means a natural person who, singly or jointly
19
with another consumer, enters into, seeks out, applies for, or
20
requests a buy-now-pay-later loan primarily for personal,
21
family, or household purposes.
22

"Department" means the Department of Financial and
23
Professional Regulation.
24

"Division" means the Division of Financial Institutions of
25
the Department of Financial and Professional Regulation.
26

"Finance charge" means the cost of financing as a dollar

SB3561 Enrolled
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1
amount.
2

"Lender" means a person that offers or makes a
3
buy-now-pay-later loan to a person in this State or is
4
otherwise subject to this Act.
5

"Licensee" means a person licensed under this Act.
6

"Motor vehicle" means a vehicle which is self-propelled
7
and every vehicle which is propelled by electric power
8
obtained from overhead trolley wires, but not operated upon
9
rails, except for vehicles moved solely by human power,
10
motorized wheelchairs, low-speed electric bicycles, and
11
low-speed gas bicycles.
12

"Multistate licensing system" means a third-party,
13
multistate licensing system used by the Secretary for
14
licensing, examinations, or any other regulatory purpose under
15
this Act.
16

"Person" means an individual, a partnership, joint
17
venture, trust, estate, firm, corporation, cooperative society
18
or association, or any other form of business association or
19
legal entity. "Person" includes the employees, owners, agents,
20
managers, members, principals, and directors of a person.
21

"Secretary" means the Secretary of Financial and
22
Professional Regulation or the Secretary's designee, including
23
the Director of the Division of Financial Institutions.

24

Section 3.
Administration by the Division of Financial
25
Institutions.
This Act shall be administered by the Division

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1
on behalf of the Secretary.

2

Section 4.
Licensure requirement.
No person shall engage
3
in the business regulated by this Act without licensure under
4
this Act. The Secretary may investigate any person the
5
Secretary believes may require licensure under this Act,
6
including, but not limited to, compelling production of
7
testimony, books, records, or any other information necessary
8
for the Secretary to determine whether the person requires
9
licensure. An owner, officer, or employee of a person required
10
to be licensed under this Act is not required to be licensed to
11
engage in activities conducted by the licensee under this Act.

12

Section 5.
Applicability.
13

(a) Except as otherwise provided in this Section, this Act
14
applies to any person, including any affiliate or subsidiary
15
of a person, that offers or makes a loan, buys a whole or
16
partial interest in a loan, arranges a loan for a third party,
17
or acts as an agent for a third party in making a loan to a
18
consumer, regardless of whether approval, acceptance, or
19
ratification by the third party is necessary to create a legal
20
obligation for the third party, and includes any other person
21
or entity if the Department determines that the person or
22
entity is engaged in a transaction that is in substance a
23
disguised loan or a subterfuge for the purpose of avoiding
24
this Act. This Act applies to loan transactions conducted by

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1
any medium, including, but not limited to, paper, facsimile,
2
Internet, or telephone. This Act also applies to any servicer
3
of a loan offered or made under this Act. This Act does not
4
apply to a merchant or merchant platform that makes a
5
buy-now-pay-later loan available to a consumer through an
6
agreement with a licensed buy-now-pay-later lender or person
7
exempt from this Act, if the merchant or merchant platform
8
does not originate, underwrite, service, or hold an ownership
9
interest in any buy-now-pay-later loan. Notwithstanding the
10
provisions of this subsection, this Act also does not apply to
11
a person who buys, acquires, or holds a partial interest in a
12
loan as a passive investor, but does not otherwise originate,
13
underwrite, or service the loan or control the servicing of
14
the loan.
15

(b) The provisions of this Act apply to any person that
16
seeks to evade its applicability by any device, subterfuge, or
17
pretense or making, offering, assisting, or arranging for a
18
consumer to obtain a loan with a greater rate of interest,
19
consideration, or charge than is permitted by this Act through
20
any method, including mail, telephone, Internet, or any
21
electronic means, regardless of whether the person or entity
22
has a physical location in this State.
23

(c) The provisions of this Act apply to any person that
24
facilitates or aids or abets a violation of this Act or rules
25
adopted under this Act.
26

(d) Banks, savings banks, savings and loan associations,

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1
credit unions, and insurance companies organized, chartered,
2
or holding a certificate of authority to do business under the
3
laws of this State, any other state, or the United States are
4
exempt from the provisions of this Act and rules adopted under
5
this Act. The Secretary may exempt from this Act other persons
6
or transactions by rule on a finding that the application of
7
the Act to the persons or transactions is not necessary to
8
achieve the purposes of this Act.
9

(e) A person is a lender subject to this Act, regardless of
10
any claim that the person is acting as an agent, service
11
provider, or in another capacity for a person that is exempt
12
from this Act, if:
13

(1) The person holds, acquires, or maintains, directly
14

or indirectly, the predominant economic interest in the
15

loan.
16

(2) The person markets, brokers, arranges, or
17

facilitates the loan and holds the right, requirement, or
18

first right of refusal to purchase the loan or receivables
19

or interests in the loan.
20

(3) The totality of the circumstances indicates that
21

the person is the lender and that the transaction is
22

structured to evade the requirements of this Act.
23

Circumstances that support a finding that a person is a
24

lender include, without limitation:
25

(A) The person indemnifies, insures, or protects
26

an exempt person or entity for any costs or risks

SB3561 Enrolled
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1

related to the loan.
2

(B) The person predominantly designs, controls, or
3

operates the loan program.
4

(C) The person purports to act as an agent,
5

service provider, or in another capacity for a person
6

exempt from this Act while acting directly as a lender
7

in other states.

8

Section 5.5.
Licensee name.
No person engaged in the
9
business regulated by this Act shall operate the business
10
under a name other than the real name of the person conducting
11
business. The business may, as authorized by the Secretary,
12
also operate under an assumed corporate name under the
13
Business Corporation Act of 1983, an assumed limited liability
14
company name under the Limited Liability Company Act, or an
15
assumed business name under the Assumed Business Name Act.

16

Section 6.
Application process; investigation; fees.

17

(a) The Secretary may issue a license to a person after the
18
person completes the following:
19

(1) the filing of an application for licensure with
20

the Secretary or the multistate licensing system, as
21

approved by the Secretary;
22

(2) the filing with the Secretary or the multistate
23

licensing system, as approved by the Secretary, of a
24

listing of judgments entered against, and bankruptcy

SB3561 Enrolled
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1

petitions by, the applicant for the preceding 10 years;
2

(3) the payment, in certified funds, of investigation
3

and application fees, the total of which shall be in an
4

amount equal to $5,000, unless modified by the Secretary
5

in accordance with subsection (b) of Section 11; and
6

(4) the filing of an audited balance sheet, including
7

all footnotes prepared by a certified public accountant in
8

accordance with generally accepted accounting principles
9

and generally accepted auditing standards; notwithstanding
10

the requirements of this subsection, an applicant that is
11

a subsidiary may submit audited consolidated financial
12

statements of its parent, intermediary parent, or ultimate
13

parent as long as the consolidated statements are
14

supported by consolidating statements that include the
15

applicant's financial statement; if the consolidating
16

statements are unaudited, the applicant's chief financial
17

officer shall attest to the applicant's financial
18

statements disclosed in the consolidating statements.

19

(b) The Secretary may, for good cause shown, waive or
20
modify the requirements of paragraph (4) of subsection (a).

21

(c) Upon receipt of the license, a licensee shall be
22
authorized to engage in the business regulated by this Act.
23
The license shall remain in full force and effect until it
24
expires, is surrendered by the licensee, or is revoked or
25
suspended as provided in this Act.

26

(d) The Secretary may impose conditions on a license if

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1
the Secretary determines that those conditions are necessary
2
or appropriate. The conditions shall be imposed in writing and
3
shall continue in effect for the period prescribed by the
4
Secretary.

5

Section 7.
Application form.
6

(a) Application for a license shall be made in accordance
7
with this Act and in accordance with requirements of the
8
multistate licensing system, if required by the Secretary. The
9
application shall be in writing, under oath, and on a form
10
obtained from and prescribed by the Secretary. The Secretary
11
may require part or all of the application to be submitted
12
electronically, with attestation, to the multistate licensing
13
system.
14

(b) The application shall contain the name and complete
15
business and residential address of the applicant. The
16
application shall also include a description of the activities
17
of the applicant in such detail and for such periods as the
18
Secretary may require, including the following:
19

(1) an affirmation that the applicant and its owners,
20

principals, officers, and directors, as may be
21

appropriate, are at least 18 years of age;
22

(2) information as to the name, complete business
23

address, complete residential address, character, fitness,
24

financial and business responsibility, background,
25

experience, and criminal record of any:

SB3561 Enrolled
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1

(i) person, including an ultimate equitable owner,
2

that directly or indirectly owns or controls 10% or
3

more of any class of stock of the applicant;
4

(ii) person, including an ultimate equitable owner
5

that is not a depository institution, as defined in
6

Section 17.50 of the Savings Bank Act, that lends,
7

provides, or infuses, directly or indirectly, in any
8

way, funds to or into an applicant in an amount equal
9

to or more than 10% of the applicant's net worth;
10

(iii) person, including an ultimate equitable
11

owner that controls, directly or indirectly, the
12

election of 25% or more of the members of the board of
13

directors of an applicant;
14

(iv) person, including an ultimate equitable owner
15

that the Secretary finds influences the management of
16

the applicant;
17

(v) directors of an applicant; and
18

(vi) principal officers of an applicant; and
19

(3) any other information as required by the Secretary
20

to assess whether the applicant and its owners, officers,
21

and directors have the financial responsibility, financial
22

condition, business experience, character, and general
23

fitness to justify the confidence of the public and that
24

the applicant and its owners, officers, and directors are
25

fit, willing, and able to carry on the proposed business
26

in a lawful and fair manner.

SB3561 Enrolled
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LRB104 20058 SPS 33509 b
1

Section 8.
License application and issuance.
2

(a) Applicants for a license shall apply in a form
3
prescribed by the Secretary. The form may be changed or
4
updated by the Secretary to carry out the purposes of this Act.
5

(b) In order to fulfill the purposes of this Act, the
6
Secretary may establish relationships or contracts with a
7
multistate licensing system or other persons to collect and
8
maintain records and process fees related to licensees or
9
other persons subject to this Act.
10

(c) In connection with an application for licensing, the
11
applicant, owners, officers, and directors of an applicant may
12
be required, at a minimum, to furnish to the Secretary or the
13
multistate licensing system information concerning the
14
identity of the applicant, owners, officers, and directors,
15
including personal history and experience in a form prescribed
16
by the Secretary or the multistate licensing system including,
17
but not limited to:
18

(1) a complete and accurate copy of an independent
19

credit report obtained from a consumer reporting agency as
20

described in Section 603(p) of the Fair Credit Reporting
21

Act (15 U.S.C. 1681a(p)); and
22

(2) information related to any administrative, civil,
23

or criminal findings by any governmental jurisdiction.
24

(d) For the purposes of this Section, and to reduce the
25
points of contact that the Secretary may have to maintain, the

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1
Secretary may use a multistate licensing system as a
2
channeling agent for requesting and distributing information
3
to and from any source.
4

(e) Each application shall be accompanied by averments as
5
determined by the Secretary to fulfill the purposes of this
6
Act.

7

Section 9.
Refusal to issue license.
The Secretary may
8
refuse to issue or renew a license if the Secretary determines
9
that:
10

(a) the applicant has not complied with a provision of
11

this Act, rule adopted under this Act, or other laws that
12

apply to the applicant;
13

(b) there is substantial continuity between the
14

applicant and any violator of this Act, rule adopted under
15

this Act, or other laws that apply to the applicant or
16

related violator; and
17

(c) the applicant or its owners, officers, or
18

directors do not have the financial responsibility,
19

financial condition, business experience, character, and
20

general fitness to justify the confidence of the public
21

and that the license applicant and its owners, officers,
22

and directors are not fit, willing, and able to carry on
23

the proposed business in a lawful and fair manner.

24

Section 10.
License issuance and renewal.

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1

(a) Absent a written extension from the Department and
2
payment of any late fees required by the Department, a license
3
shall expire on the last day of December of each calendar year
4
if a licensee fails to timely submit a properly completed
5
renewal application form and fees.
6

(b) Licensees shall apply to renew their license every
7
calendar year. Licensees may submit properly completed renewal
8
application forms and filing fees 60 days before the license
9
expiration date. To be deemed timely, the completed renewal
10
application forms and filing fees must be received by the
11
Secretary at least 30 days before the license expiration date.
12

(c) It shall be the responsibility of each licensee to
13
accomplish timely renewal of its license.
14

(d) No activity regulated by this Act shall be conducted
15
by a licensee whose license has expired. The Secretary may,
16
within the Secretary's discretion, reinstate an expired
17
license upon payment of the renewal fee, payment of a
18
reactivation fee equal to 5 times the renewal fee, submission
19
of a completed renewal application, and an affidavit of good
20
cause for late renewal.

21

Section 11.
Fees.
22

(a) The expenses of administering this Act, including
23
licensing, investigations, and examinations provided for in
24
this Act, shall be borne by and assessed against persons and
25
entities regulated by this Act in the proportions and in the

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1
manner as the Secretary deems appropriate. The Secretary may
2
establish by rule the category and amount of any fees that the
3
person and entities pay to the Department.
4

(b) The Secretary may modify any fees established by this
5
Act by rule beginning one year after the effective date of this
6
Act.

7

Section 12.
Functions; powers; duties.
The functions,
8
powers, and duties of the Secretary shall include, but shall
9
not be limited to:
10

(a) to issue or refuse to issue any license or
11

renewal;
12

(b) to impose fines, revoke, or suspend for cause any
13

license issued under this Act;
14

(c) to impose fines for any unlicensed activity under
15

this Act;
16

(d) to keep records of all licenses issued under this
17

Act;
18

(e) to receive, consider, investigate, and act upon
19

complaints made by any person in connection with any
20

licensee in this State or unlicensed activity under this
21

Act of any person;
22

(f) to prescribe the forms of and receive:
23

(1) applications for licenses and renewals; and
24

(2) all reports and all books and records required
25

to be made by any licensee, including annual audited

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1

financial statements if required by the Secretary and
2

annual reports of activity;
3

(g) to adopt rules necessary and proper for the
4

administration of this Act, to protect consumers and to
5

promote fair competition;
6

(h) to subpoena documents and witnesses and compel
7

attendance and production, to administer oaths, and to
8

require the production of any books, papers, or other
9

materials relevant to any inquiry authorized by this Act
10

or rules adopted under this Act;
11

(i) to issue orders against any person if the
12

Secretary has reasonable cause to believe that an unsafe,
13

unsound, or unlawful practice has occurred, is occurring,
14

or is about to occur; if any person is violating, or is
15

about to violate any law, rule, or written agreement with
16

the Secretary; or for the purpose of administering the
17

provisions of this Act and any rule adopted in accordance
18

with this Act;
19

(j) to address any inquiries to any licensee, or the
20

owners, officers, or directors, in relation to its
21

activities and conditions, or any other matter connected
22

with its affairs, and it shall be the duty of any licensee
23

or person so addressed to promptly reply in writing to
24

those inquiries; and to require reports from any licensee
25

at any time the Secretary may deem desirable;
26

(k) to examine the books and records of every licensee

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1

or any person requiring a license or who the Secretary
2

reasonably believes may require a license at any time
3

interval reasonably determined appropriate by the
4

Secretary;
5

(l) to enforce provisions of this Act and rules
6

adopted under this Act;
7

(m) to levy fees including, but not limited to,
8

contingent fees, assessments, examination fees, licensing
9

fees, fines, and charges for services performed in
10

administering this Act;
11

(n) to issue refunds to licensees within one year of
12

any overpayment for good cause shown;
13

(o) to appoint examiners, supervisors, experts, and
14

special assistants as needed to effectively and
15

efficiently administer this Act;
16

(p) to conduct hearings for the purpose of carrying
17

out the purposes of this Act;
18

(q) to exercise visitorial power over a licensee;
19

(r) to enter into cooperative agreements with state
20

regulatory authorities of other states to provide for
21

examination of corporate offices or branches in those
22

states, participate in joint examinations with other
23

regulators, and to accept reports of the examinations;
24

(s) to assign an examiner or examiners to monitor the
25

affairs of a licensee with whatever frequency the
26

Secretary determines appropriate and to charge the

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1

licensee for reasonable and necessary expenses of the
2

Secretary if in the opinion of the Secretary an emergency
3

exists or appears likely to occur;
4

(t) to impose civil penalties of up to $1,000 per day
5

against a licensee for failing to respond to a regulatory
6

request or reporting requirement; and
7

(u) to enter into agreements in connection with a
8

multistate licensing system.

9

Section 13.
Financial Institutions Fund.
All moneys
10
received by the Secretary under this Act shall be paid into the
11
Financial Institutions Fund. The amounts deposited into the
12
Fund shall be used for the ordinary and contingent expenses of
13
the Department. Nothing in this Act shall prevent paying
14
expenses involving salaries, retirement, social security, and
15
State-paid insurance of State employees, or any other expenses
16
incurred under this Act by appropriation from the General
17
Revenue Fund, PIC Fund, or any other fund.

18

Section 14.
Examination; prohibited activities.
19

(a) The Secretary shall examine the business affairs of a
20
licensee as often as the Secretary deems necessary and proper.
21
The Secretary may adopt rules with respect to the frequency
22
and manner of examination. The Secretary shall appoint a
23
suitable person to perform the examination. The Secretary and
24
the Secretary's appointees may examine the entire books,

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1
records, documents, and operations of each licensee and its
2
subsidiary, affiliate, or agent, and may examine any of the
3
licensee's or its subsidiaries', owners', affiliates', or
4
agents' officers, directors, employees, and agents under oath.
5

(b) Affiliates of a licensee shall be subject to
6
examination by the Secretary only to the extent reasonably
7
necessary to evaluate the licensee's compliance with this Act
8
and only with respect to records directly related to the
9
licensee's regulated activities under this Act.
10

(c) The expenses of any examination of the licensee or its
11
affiliates shall be borne by the licensee and assessed by the
12
Secretary as may be established by rule.
13

(d) All confidential supervisory information, including
14
the examination report and the work papers of the report,
15
shall belong to the Secretary's office and may not be
16
disclosed to anyone other than the licensee, law enforcement
17
officials, or other regulatory agencies that have an
18
appropriate regulatory interest as determined by the
19
Secretary, or to a party presenting a lawful subpoena to the
20
Department. The Secretary may, through the Attorney General,
21
immediately appeal to the court of jurisdiction the disclosure
22
of the confidential supervisory information and seek a stay of
23
the subpoena pending the outcome of the appeal. Reports
24
required of licensees by the Secretary under this Act and
25
results of examinations performed by the Secretary under this
26
Act shall be the property of only the Secretary, but may be

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shared with the licensee. Any person demanded to produce the
2
Department's confidential supervisory information, whether by
3
subpoena, order, or other judicial or administrative process,
4
shall withhold production of the confidential supervisory
5
information and notify the Secretary of the demand. The
6
Secretary may intervene for the purpose of enforcing the
7
limitations of this Section or seeking the withdrawal or
8
termination of the attempt to compel production of the
9
confidential supervisory information. The Secretary may impose
10
any conditions and limitations on the disclosure of
11
confidential supervisory information that are necessary to
12
protect the confidentiality of that information. The Secretary
13
may condition a decision to disclose confidential supervisory
14
information on entry of a protective order by the court or
15
administrative tribunal presiding in the particular case or on
16
a written agreement of confidentiality. In a case in which a
17
protective order or agreement has already been entered between
18
parties other than the Secretary, the Secretary may
19
nevertheless condition approval for release of confidential
20
supervisory information upon the inclusion of additional or
21
amended provisions in the protective order. The Secretary may
22
authorize a party who obtained the records for use in one case
23
to provide them to a party in another case, subject to any
24
conditions that the Secretary may impose on either or both
25
parties. The requester shall promptly notify other parties to
26
a case of the release of confidential supervisory information

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obtained and, upon entry of a protective order, shall provide
2
copies of confidential supervisory information to the other
3
parties.

4

Section 15.
Subpoena power of the Secretary.
5

(a) The Secretary shall have the power to issue and to
6
serve subpoenas and subpoenas duces tecum to compel the
7
attendance of witnesses and the production of all books,
8
accounts, records, and other documents and materials relevant
9
to an examination or investigation. The Secretary or the
10
Secretary's duly appointed representative shall have the power
11
to administer oaths and affirmations to any person.
12

(b) If a person does not comply with the Secretary's
13
subpoena or subpoena duces tecum, the Secretary may, through
14
the Attorney General, petition the circuit court of the county
15
in which the subpoenaed person resides or has its principal
16
place of business for an order requiring the subpoenaed person
17
to testify and to comply with the subpoena duces tecum.
18

(c) The court may grant injunctive relief restraining the
19
person from engaging in activity regulated by this Act. The
20
court may grant other relief, including, but not limited to,
21
the restraint, by injunction or appointment of a receiver, of
22
any transfer, pledge, assignment, or other disposition of the
23
person's assets, concealment, destruction, or other
24
disposition of books, accounts, records, or other documents
25
and materials as the court deems appropriate, until the person

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has fully complied with the subpoena or subpoena duces tecum
2
and the Secretary has completed an investigation or
3
examination.
4

(d) If it appears to the Secretary that the compliance
5
with a subpoena or subpoena duces tecum issued or caused to be
6
issued by the Secretary under this Section is essential to an
7
investigation or examination, the Secretary, in addition to
8
the other remedies provided for in this Act, may, through the
9
Attorney General, apply for relief to the circuit court of the
10
county in which the subpoenaed person resides or has its
11
principal place of business. The court shall direct the
12
issuance of an order against the subpoenaed person requiring
13
sufficient bond conditioned on compliance with the subpoena or
14
subpoena duces tecum. The court shall cause to be endorsed on
15
the order a suitable amount of bond or payment under which the
16
person named shall be freed, having a due regard to the nature
17
of the case.
18

(e) In addition, the Secretary may, through the Attorney
19
General, seek a writ of attachment or an equivalent order from
20
the circuit court having jurisdiction over the person who has
21
refused to obey a subpoena, who has refused to give testimony,
22
or who has refused to produce the matters described in the
23
subpoena duces tecum.

24

Section 16.
Reports required of licensee.
Every licensee
25
shall produce to the Department written reports or answers to

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questions in the time and manner requested by the Secretary.

2

Section 17.
Suspension; revocation of licenses; fines and
3
other discipline.
4

(a) The Secretary may enter an order imposing one or more
5
of the following penalties:
6

(1) revocation of license;
7

(2) suspension of a license subject to reinstatement
8

upon satisfying all reasonable conditions the Secretary
9

may specify;
10

(3) placement of the licensee or applicant on
11

probation for a period of time and subject to all
12

reasonable conditions as the Secretary may specify;
13

(4) issuance of a reprimand;
14

(5) imposition of a civil penalty or fine not to
15

exceed $25,000 for each count of separate offense;
16

(6) restitution, refunds, or any other relief
17

necessary to protect consumers; and
18

(7) denial of a license.
19

(b) Grounds for penalties include:
20

(1) that a person has violated or aided another to
21

violate, any provisions of this Act, any rule adopted by
22

the Secretary, or any other law, rule, or regulation of
23

this State, any other state, or the United States;
24

(2) that any fact or condition exists that, if it had
25

existed at the time of the original application for the

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license, would have warranted the Secretary in refusing to
2

issue the original license;
3

(3) that a licensee that is not an individual has
4

acted or failed to act in a way that would be cause for
5

suspending or revoking a license to an individual;
6

(4) that a person engaged in unsafe, unsound, unfair,
7

deceptive, or abusive business practices related to the
8

activity covered by this Act;
9

(5) that a person has been adjudicated guilty of a
10

crime against the law of this State, any other state, or of
11

the United States involving moral turpitude, abusive,
12

deceptive, fraudulent, or dishonest dealing;
13

(6) that a final judgment has been entered against a
14

person in a civil action upon grounds of abusive conduct,
15

conversion, fraud, misrepresentation, or deceit;
16

(7) that a person made a material misstatement in its
17

application for licensure or any other communication to
18

the Secretary;
19

(8) that a person has demonstrated by course of
20

conduct, negligence or incompetence in performing any act
21

for which it is required to hold a license under this Act;

22

(9) that a person has failed to advise the Secretary
23

in writing of any changes to the information submitted on
24

the person's most recent application for license within 30
25

days after the change;
26

(10) that a licensee failed to submit to periodic

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examination by the Secretary as required by this Act or
2

failed to maintain, preserve, and keep available for
3

examination all books, accounts, or other documents
4

required by the provisions of this Act and rules adopted
5

under this Act for a period of at least 2 years after the
6

loan is paid in full or any time period set forth by rule;
7

(11) that a person failed to account or deliver to any
8

person any property, such as any money, fund, deposit,
9

check, draft, or other document or thing of value, that
10

has come into the person's possession and that is not the
11

person's property or that the person is not in law or
12

equity entitled to retain, under the circumstances and at
13

the time which has been agreed upon or is required by law
14

or, in the absence of a fixed time, upon demand of the
15

person for the accounting and delivery;
16

(12) that a person failed to disburse funds in
17

accordance with agreements or law;
18

(13) that a person had a license, or the equivalent,
19

to practice any profession, occupation, other industry or
20

activity requiring licensure revoked, suspended,
21

disciplined, or otherwise acted against, including the
22

denial of licensure by a licensing authority of this State
23

or another state, territory, or country for fraud,
24

dishonest dealing, misrepresentations, incompetence,
25

conversion, any act of moral turpitude or any other
26

grounds that would constitute grounds for discipline under

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this Act;

2

(14) that a person licensed under this Act failed to
3

timely notify the Department that the person has been
4

disciplined by a licensing authority of this State or
5

another state;
6

(15) that a person engaged in activities regulated by
7

the Act without a current, active license unless
8

specifically exempted by this Act;
9

(16) that a person failed to timely pay any fee,
10

charge, or fine assessed under this Act; and
11

(17) that a person refused, obstructed, evaded, or
12

unreasonably delayed an investigation, information
13

request, or examination authorized under this Act, or
14

refused, obstructed, evaded, or unreasonably delayed
15

compliance with the Secretary's subpoena or subpoena duces
16

tecum.
17

(c) No license shall be suspended or revoked, except as
18
provided in this Section nor shall any licensee be fined,
19
without notice of the licensee's right to a hearing.
20

(d) The Secretary may suspend any license for a period not
21
exceeding 90 days pending investigation for good cause shown
22
that an emergency exists.
23

(e) No revocation, suspension, or surrender of any license
24
shall impair or affect the obligation of any preexisting
25
lawful contract between the licensee and any person. The
26
Secretary's approval of a licensee's application to surrender

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its license shall not affect the licensee's civil or criminal
2
liability for acts committed prior to surrender. Surrender of
3
a license does not entitle the licensee to a return of any part
4
of the fee for initial licensure or any part of the fee for
5
annual license renewal.
6

(f) Every license issued under this Act shall remain in
7
force and effect until the license expires, is surrendered, is
8
revoked, or is suspended in accordance with the provisions of
9
this Act. The Secretary may reinstate a suspended license or
10
issue a new license to a licensee whose license has been
11
revoked or surrendered if no fact or condition then exists
12
which would have warranted the Secretary in refusing
13
originally to issue that license under this Act.
14

(g) If the Secretary imposes discipline authorized by this
15
Section, the Secretary shall execute a written order to that
16
effect. The Secretary shall serve a copy of the order upon the
17
person. The Secretary shall serve the person with notice of
18
the order, including a statement of the reasons for the order,
19
either personally, or by certified mail. Service by certified
20
mail shall be deemed completed when the notice is deposited
21
into the U.S. Mail.
22

(h) An order assessing a fine, an order imposing
23
conditions upon a license, an order revoking or suspending a
24
license, or an order denying renewal of a license shall take
25
effect upon service of the order unless the licensee serves
26
the Department with a written request for a hearing in the

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manner required by the notice within 20 days after the date of
2
service of the order. If a person requests a hearing, the order
3
shall be stayed from its date of service until the Department
4
enters a final administrative order.
5

(1) If the licensee requests a hearing, the Secretary
6

shall schedule a preliminary hearing within 90 days after
7

the request for a hearing unless otherwise agreed to by
8

the parties.
9

(2) The preliminary hearing shall be held at the time
10

and place designated by the Secretary. The Secretary and
11

any administrative law judge designated by the Secretary
12

shall have the power to administer oaths and affirmations,
13

subpoena witnesses and compel their attendance, take
14

evidence, and require the production of books, papers,
15

correspondence, and other records or information that the
16

Secretary considers relevant or material to the inquiry.
17

(i) The costs of administrative hearings conducted under
18
this Section shall be paid by the licensee or other person
19
subject to the hearing.
20

(j) A licensee and other persons subject to this Act shall
21
be subject to the disciplinary actions specified in this Act
22
for any violations conducted by any officer, director,
23
shareholder, joint venture, partner, owner, including, but not
24
limited to, ultimate equitable owner.

25

Section 18.
Investigation of complaints.
The Secretary may

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investigate any complaints and inquiries made concerning this
2
Act and any licensees or persons the Secretary believes may
3
require a license under this Act. Each licensee or person the
4
Secretary believes may require a license under this Act shall
5
open the licensee or person's books, records, documents, and
6
offices wherever situated to the Secretary as needed to
7
facilitate the investigations.

8

Section 19.
Additional investigation and examination
9
authority.
In addition to any authority allowed under this
10
Act, the Secretary shall have the authority to conduct
11
investigations and examinations as follows:
12

(a) For purposes of initial licensing, license
13

renewal, license suspension, license conditioning, license
14

probation, license revocation or termination, or general
15

or specific inquiry or investigation to determine
16

compliance with this Act, the Secretary shall have the
17

authority to access, receive, and use any books, accounts,
18

records, files, documents, information, or evidence,
19

including, but not limited to, the following:
20

(1) criminal, civil, licensure, and administrative
21

history information, including nonconviction data as
22

specified in the Criminal Identification Act;
23

(2) personal history and experience information,
24

including independent credit reports obtained from a
25

consumer reporting agency described in Section 603(p)

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of the federal Fair Credit Reporting Act; and
2

(3) any other documents, information, or evidence
3

the Secretary deems relevant to the inquiry or
4

investigation, regardless of the location, possession,
5

control, or custody of the documents, information, or
6

evidence.
7

(b) For the purposes of investigating violations or
8

complaints arising under this Act or for the purposes of
9

examination, the Secretary may review, investigate, or
10

examine any licensee, individual, or person subject to
11

this Act as often as necessary in order to carry out the
12

purposes of this Act. The Secretary may direct, subpoena,
13

or order the attendance of, and examine under oath all
14

persons; and order any person to produce records, files,
15

and any other documents the Secretary deems relevant to an
16

inquiry.
17

(c) Each person subject to this Act shall make
18

available to the Secretary upon request the books and
19

records relating to the operations of the person subject
20

to this Act. The Secretary shall have access to those
21

books and records and may interview the owners, officers,
22

principals, employees, independent contractors, agents,
23

vendors, and customers of any licensee or person subject
24

to this Act.
25

(d) Each person subject to this Act shall make or
26

compile reports or prepare other information as directed

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by the Secretary to carry out the purposes of this
2

Section, including, but not limited to:
3

(1) accounting compilations;
4

(2) information lists and data concerning
5

transactions in a format prescribed by the Secretary;
6

or
7

(3) other information deemed necessary to carry
8

out the purposes of this Section.
9

(e) In making any examination or investigation
10

authorized by this Act, the Secretary may control access
11

to any documents and records of the licensee or person
12

under examination or investigation. The Secretary may take
13

possession of the documents and records or otherwise take
14

constructive control of the documents. During the period
15

of control, no person shall remove or alter any of the
16

documents or records, except in accordance with a court
17

order or with the consent of the Secretary. Unless the
18

Secretary has reasonable grounds to believe the documents
19

or records of the licensee have been or are at risk of
20

being altered or destroyed for purposes of concealing a
21

violation of this Act, the licensee or owner of the
22

documents and records shall have access to the documents
23

or records as necessary to conduct its ordinary business
24

affairs.
25

(f) In order to carry out the purposes of this
26

Section, the Secretary may:

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(1) retain attorneys, accountants, or other
2

professionals and specialists as examiners, auditors,
3

or investigators to conduct or assist in the conduct
4

of examinations or investigations;
5

(2) enter into agreements or relationships with
6

other government officials or regulatory associations
7

to protect consumers, improve efficiencies, and reduce
8

regulatory burden by sharing resources, standardized
9

or uniform methods or procedures, and documents,
10

records, information, or evidence obtained under this
11

Section;
12

(3) use, hire, contract, or employ publicly or
13

privately available analytical systems, methods, or
14

software to examine or investigate the licensee,
15

individual, or person subject to this Act;
16

(4) accept and rely on examination or
17

investigation reports made by other government
18

officials, within or outside this State; or
19

(5) accept audit reports made by an independent
20

certified public accountant for the person subject to
21

this Act and incorporate the audit report in the
22

report of the examination, report of investigation, or
23

other writing of the Secretary.
24

(g) The authority of this Section shall remain in
25

effect, whether a person subject to this Act acts or
26

claims to act under any licensing or registration law of

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this State or claims to act without authority.
2

(h) No licensee or person subject to investigation or
3

examination under this Section may knowingly withhold,
4

alter, abstract, remove, mutilate, destroy, hide, or
5

conceal any books, records, computer records, or other
6

information or take actions designed to delay or
7

complicate review of records.

8

Section 20.
Confidentiality.
To promote more effective
9
regulation, protect consumers, and reduce regulatory burden
10
through inter-regulator sharing of confidential supervisory
11
information:
12

(a) The privacy or confidentiality of any information
13

or material provided to the multistate licensing system,
14

including all privileges arising under federal or State
15

court rules and law, shall continue to apply to the
16

information or material after the information or material
17

has been disclosed to the multistate licensing system.
18

Information and material may be shared with the multistate
19

licensing system, federal and state regulatory officials
20

with relevant oversight authority, and law enforcement
21

without the loss of privilege or the loss of
22

confidentiality protections.
23

(b) The Secretary may enter into agreements or sharing
24

arrangements with other governmental agencies, the
25

Conference of State Bank Supervisors, and other

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associations representing governmental agencies.
2

(c) Information or material that is privileged or
3

confidential under this Act as determined by the Secretary
4

shall not be subject to the following:
5

(1) disclosure under any State law governing the
6

disclosure to the public of information held by an
7

officer or an agency of this State; or
8

(2) subpoena, discovery, or admission into
9

evidence, in any private civil action or
10

administrative process except as authorized by the
11

Secretary.
12

(d) Any other law relating to the disclosure of
13

confidential supervisory information that is inconsistent
14

with this Act shall be superseded by the requirements of
15

this Section to the extent the other law provides less
16

confidentiality or a weaker privilege for information that
17

is privileged or confidential under this Act.
18

(e) Confidential or privileged information received
19

from the multistate licensing system, another licensing
20

body, federal and state regulatory officials, or law
21

enforcement shall be protected to the same extent as the
22

Secretary's confidential and privileged information is
23

protected under this Act. The Secretary may also protect
24

from disclosure confidential or privileged information
25

that would be exempt from disclosure to the extent it is
26

held directly by the multistate licensing system, another

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licensing body, federal and state regulatory officials, or
2

law enforcement.

3

Section 21.
Rules.
4

(a) In addition to the powers set forth in this Act and
5
other laws, the Secretary may adopt rules consistent with the
6
purposes of this Act, including, but not limited to, rules to:
7

(1) protect consumers in this State in connection with
8

the activities of persons subject to this Act;
9

(2) define improper, deceptive, unfair, abusive, or
10

fraudulent business practices in connection with providing
11

products and services under this Act;
12

(3) define terms used in this Act to interpret and
13

implement this Act;
14

(4) promote competition and price transparency; and
15

(5) enforce the provisions of this Act.
16

(b) The Secretary may make specific rulings, demands, and
17
findings deemed necessary for the proper conduct of the
18
buy-now-pay-later loan industry.

19

Section 22.
Appeal and review.
20

(a) The Secretary may, in accordance with the Illinois
21
Administrative Procedure Act, adopt rules to provide for
22
review within the Department of the Secretary's decisions
23
affecting the rights of persons under this Act. The review
24
shall provide for, at a minimum:

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(1) appointment of a hearing officer;
2

(2) appropriate procedural rules, specific deadlines
3

for filings, and standards of evidence and of proof; and
4

(3) provisions for apportioning costs among parties to
5

the appeal.
6

(b) All final agency determinations of appeals to
7
decisions of the Secretary may be reviewed in accordance with
8
and under the provisions of the Administrative Review Law.
9
Appeals from all final orders and judgments entered by a court
10
in review of any final administrative decision of the
11
Secretary or of any final agency review of a decision of the
12
Secretary may be taken as in other civil cases.

13

Section 23.
Licensure fees.
14

(a) The nonrefundable fee for initial licensure shall be
15
$5,000, unless modified by the Secretary in accordance with
16
subsection (b) of Section 11.
17

(b) The nonrefundable fee for annual license renewal shall
18
be $5,000, unless modified by the Secretary in accordance with
19
subsection (b) of Section 11.
20

(c) The Department shall impose a contingent fee
21
sufficient to cover its operating expenses in administering
22
this Act not otherwise covered by all other revenue collected
23
under this Act. Each licensee shall pay to the Division its pro
24
rata share, based on number or volume of transactions or
25
revenue or any other metric established by the Department by

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rule, of the cost for administration of the Act that exceeds
2
other fees listed in this Section, as estimated by the
3
Division, for the current year and any deficit actually
4
incurred in the administration of the Act in prior years.

5

Section 24.
Cease and desist order.
6

(a) The Secretary may issue a cease and desist order to any
7
licensee or person doing business without the required
8
license, when in the opinion of the Secretary the licensee or
9
other person has violated, is violating, or is about to
10
violate any provision of this Act or any rule adopted by the
11
Department under this Act or any requirement imposed in
12
writing by the Department as a condition of granting any
13
authorization permitted by this Act. The cease and desist
14
order authorized by this Section may be issued prior to a
15
hearing.
16

(b) The Secretary shall serve notice of the order, either
17
personally or by certified mail. Service by certified mail
18
shall be deemed completed when the notice is deposited into
19
the U.S. Mail. The Secretary's notice shall include a
20
statement of the reasons for the action.
21

(c) Within 15 days after service of the cease and desist
22
order, the person subject to the order may request a hearing in
23
writing. The Secretary shall schedule a preliminary hearing
24
within 60 days after the request for a hearing unless the
25
parties agree to a later date.

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(d) If it is determined that the Secretary had the
2
authority to issue the cease and desist order, the Secretary
3
may issue orders as may be reasonably necessary to correct,
4
eliminate, deter, or remedy the conduct described in the order
5
and resulting harms.
6

(e) The powers vested in the Secretary by this Section are
7
additional to all other powers and remedies vested in the
8
Secretary by any law. Nothing in this Section shall be
9
construed as requiring that the Secretary must employ the
10
power conferred in this subsection instead of or as a
11
condition precedent to the exercise of any other power or
12
remedy vested in the Secretary.

13

Section 25.
Injunction.
The Secretary may maintain an
14
action in the name of the people of the State of Illinois
15
through the Attorney General and may apply for an injunction
16
in the circuit court to enjoin a person from violating this Act
17
or rules adopted under this Act.

18

Section 26.
Underwriting.
A lender shall, before providing
19
or causing to be provided a loan to a consumer, perform, or
20
cause to be performed, reasonable risk-based underwriting
21
which shall include, at a minimum, an assessment of the
22
outstanding loans taken out by the consumer from the lender. A
23
lender shall also, before providing or causing to be provided
24
a loan to a consumer, take into consideration the financial

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ability of the borrower to repay the loan in the time and
2
manner provided in the loan contract. A lender shall maintain
3
or cause to be maintained policies and procedures for
4
underwriting loans, and shall disclose factors considered in
5
the underwriting process, in a clear and conspicuous manner to
6
the consumer. Nothing in this Act shall be construed to
7
require a lender to disclose proprietary underwriting models,
8
anti-fraud criteria, or trade secrets to the public. No lender
9
shall collect, evaluate, report, or maintain in the file on a
10
borrower the credit worthiness, credit standing, or credit
11
capacity of members of the borrower's social network for
12
purposes of determining the credit worthiness of the borrower;
13
the average credit worthiness, credit standing, or credit
14
capacity of members of the borrower's social network; or any
15
group score that is not the borrower's own credit worthiness,
16
credit standing, or credit capacity. The Department may adopt
17
rules with respect to underwriting.

18

Section 27.
Consumer protections.
19

(a) A lender shall provide the following disclosures to a
20
consumer, in a clear and conspicuous manner, at the time of
21
extending a specific offer of a loan:
22

(1) how to file a complaint with the Department;
23

(2) the terms of buy-now-pay-later loans, including,
24

without limitation, the cost, such as interest and fees,
25

the repayment schedule, the means by which a person may

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dispute billing practices, whether the transaction will or
2

will not be reported to a credit reporting agency, and
3

other material conditions, in a clear and conspicuous
4

manner and in a manner that complies with applicable
5

federal regulations, including, but not limited to,
6

Regulation Z of Title I of the Consumer Credit Protection
7

Act;
8

(3) factors considered in the underwriting process;
9

and
10

(4) Any other disclosures required by the Secretary by
11

rule.
12

(b) A lender shall comply with the Gramm-Leach-Bliley Act
13
Privacy Rule, Section 624 of the Fair Credit Reporting Act (15
14
U.S.C. 1681s-3), and their implementing regulations.
15

(c) A lender shall resolve disputes in a manner that is
16
fair and transparent to consumers. A lender shall create a
17
readily available and prominently disclosed method for
18
consumers to bring a dispute to the lender. A lender shall
19
maintain policies and procedures for handling consumer
20
disputes. A lender shall apply to loans the dispute rights and
21
unauthorized charges requirements that apply to credit cards
22
under the federal Truth in Lending Act, regardless of whether
23
the law applies to loans or whether the lender offers a credit
24
card within the scope of the law.
25

(d) A lender shall provide refunds or credits for goods or
26
services purchased in connection with a loan, if the consumer

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requests and is entitled to a refund, in a manner that is fair,
2
transparent, and not unduly burdensome to consumers. A lender
3
shall maintain policies and procedures to provide the refunds
4
or credits. The policies and procedures shall be fair,
5
transparent, and not unduly burdensome to the consumer. A
6
lender shall disclose to consumers, in a clear and conspicuous
7
manner, the process by which they can obtain refunds or
8
credits for goods or services they have purchased in
9
connection with a loan.
10

(e) A lender shall not require consumers to authorize
11
automatic payment from the consumer's accounts. If a consumer
12
voluntarily elects to use automatic payments in relation to
13
the loan, the lender shall not charge the consumer any amount
14
to cancel automatic payments should the consumer request to do
15
so.
16

(f) A lender shall not require payment by a consumer by
17
credit card.
18

(g) A lender shall not attempt to debit a consumer's
19
account if it is notified that there are insufficient funds to
20
pay in the account or if it has reason to believe there are
21
insufficient funds to pay in the account without seeking
22
additional, express approval from the consumer. A lender shall
23
present an ACH debit for payment not more than twice.
24

(h) The lender's license shall be kept conspicuously
25
posted on the mobile application, website, or other consumer
26
interface of the lender, as well as listed in the terms and

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conditions of any loan offered or entered into by the lender.
2

(i) A consumer shall be permitted to pay off the loan at
3
any time. A lender may not impose, directly or indirectly, any
4
additional fee or finance charge other than interest accrued
5
since the consumer's last payment or the start of the loan if
6
the consumer elects to pay off or refinance the loan before
7
full repayment.
8

(j) A lender may not accept tips, expedited payment fees,
9
or any other fee identified by the Department by rule from
10
consumers. Additionally, the Department may limit any fee,
11
charge, or payment which may be charged to a consumer by a
12
lender.
13

(k) A lender shall maintain policies and procedures for
14
underwriting buy-now-pay-later loans and follow the policies
15
and procedures when underwriting loans under this Act.
16

(l) All requirements set forth in this Section or in any
17
rules adopted by the Department relating to servicing of a
18
loan shall apply to a subsequent purchaser or assignee of a
19
loan, an agent of the lender, or any other person servicing a
20
loan.

21

Section 27.5.
Compliance with federal law.
All disclosures
22
required by this Act shall be made in a manner that complies
23
with the federal Truth in Lending Act, amendments thereto, and
24
any regulations issued or which may be issued thereunder.

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Section 28.
Rate cap.
A loan entered into under this Act is
2
subject to the rate cap set forth in Section 15-5-5 of the
3
Predatory Loan Prevention Act.

4

Section 29.
Nullification of loans.
Any loan made by a
5
person not licensed or otherwise exempt under this Act is null
6
and void and no person or entity shall have any right to
7
collect, attempt to collect, receive, or retain any principal,
8
fee, interest, or charges related to the loan.

9

Section 30.
Annual report.
The Secretary may require an
10
annual report from all licensees in a form and manner
11
prescribed by the Secretary. The Department may publish
12
reports containing a compilation of aggregate data concerning
13
the buy-now-pay-later loan industry.

14

Section 31.
Surety bond.
15

(a) An applicant for a license shall post and a licensee
16
must maintain with the Secretary a bond or bonds issued by
17
corporations qualified to do business as surety companies in
18
this State.
19

(b) The applicant or licensee shall post a bond in a
20
minimum amount of $50,000. If the Secretary finds at any time
21
that a bond is of insufficient size, is insecure, exhausted,
22
or otherwise doubtful, an additional bond in the amount as
23
determined by the Secretary shall be filed by the licensee

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within 30 days after written demand by the Secretary.
2

(c) The bond must be in a form satisfactory to the
3
Secretary and shall run to the State of Illinois for the
4
benefit of any claimant against the applicant or licensee with
5
respect to any activity regulated by this Act, including
6
unpaid fees, fines, or penalties owed to the Department. A
7
claimant damaged by a breach of the conditions of a bond shall
8
have a right of action upon the bond for damages suffered and
9
may bring suit directly on the bond, or the Secretary may bring
10
suit on behalf of the claimant.

11

Section 32.
Relation to other laws.
Nothing in this Act
12
shall be construed to limit the obligation of a licensee to
13
comply with any other applicable laws or rules, including, but
14
not limited to, the Predatory Loan Prevention Act. Any
15
protections, rights, and remedies provided in this Act to a
16
consumer with respect to an agreement with a lender shall be
17
intended to supplement and not be exclusive of any
18
protections, rights, and remedies otherwise available under
19
any other law.

20

Section 33.
Limitation on liability.
No provision of this
21
Act imposes any liability on a lender as a result of the actual
22
annual percentage rate charged by a lender differing from the
23
estimated annual percentage rate disclosed in conformity with
24
any regulation, order, or written interpretive opinion of the

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Secretary or any opinion of the Attorney General, whether or
2
not the regulation, order, or written interpretive opinion is
3
later amended, rescinded, or repealed or determined by
4
judicial or other authority to be invalid for any reason.

5

Section 34.
Liberal construction and purpose.
This Act
6
shall be liberally construed to protect consumers.

7

Section 35.
Compliance.
No person shall be required to
8
comply with this Act until January 1, 2028, or a later date
9
established by the Department by rule.

10

Section 37.
Violations.
11

(a) Nothing in this Act shall be construed to restrict the
12
exercise of powers or the performance of the duties of the
13
Attorney General that the Attorney General is authorized to
14
exercise or perform by law.
15

(b) A violation of this Act constitutes an unlawful
16
practice under the Consumer Fraud and Deceptive Business
17
Practices Act. All remedies, penalties, and authority granted
18
to the Attorney General by the Consumer Fraud and Deceptive
19
Business Practices Act shall be available to the Attorney
20
General for the enforcement of this Act.

21

Section 38.
Other licenses.
A person holding (i) a license
22
under the Consumer Installment Loan Act, (ii) a license under

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the Collection Agency Act, (iii) a license under the Sales
2
Finance Agency Act, or (iv) a license identified by the
3
Department by rule is not required to be licensed under this
4
Act, but is otherwise required to comply with this Act,
5
including, but not limited to, the payment of fees relating to
6
the activity subject to this Act. The person shall notify the
7
Department that it is conducting activity subject to this Act
8
at the time of the renewal of the person's license.

9

Section 39.
Safe harbor.
A person that (i) was providing
10
buy-now-pay-later loans in this State before January 1, 2028
11
and (ii) submits an application for a license on or before
12
January 1, 2028 shall be deemed a provisional licensee
13
authorized to continue operating under this Act until the
14
Department acts on the application. In addition to any other
15
grounds for denying an application under this Act, the
16
Department may deny such an application if it finds that the
17
applicant's reputation does not warrant the belief that the
18
business will be operated honestly and fairly within the
19
purposes of this Act and that the applicant does not meet the
20
positive net worth requirement. The Department may, by rule,
21
extend the compliance date for any provision of this Act.

22

Section 40.
Relation to other laws.
Any loan made under
23
and in compliance with this Act is not required to comply with
24
the Consumer Installment Loan Act or the Payday Loan Reform

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Act.

2

Section 900.
The Consumer Fraud and Deceptive Business
3
Practices Act is amended by adding Section 2MMMM as follows:

4

(815 ILCS 505/2MMMM new)
5

Sec. 2MMMM.
Violations of the Buy-Now-Pay-Later Loan
6
Consumer Protection Act.
A person who violates the
7
Buy-Now-Pay-Later Loan Consumer Protection Act commits an
8
unlawful practice within the meaning of this Act.

9

Section 997.
Severability.
If any provision of this Act or
10
the application of the provision is held invalid, the
11
invalidity shall not affect other provisions or applications
12
of the Act which can be given effect without the invalidated
13
provision or application.

14

Section 999.
Effective date.
This Act takes effect upon
15
becoming law.

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