Texas OCCC Registration Deadline: December 31, 2026
Published September 14, 2026 · CredibleLaw Editorial Team · Reading time: 12 minutes
Verified against Texas Finance Code Chapter 398, the adopted rules at 7 TAC Chapter 86 Subchapter C, and the OCCC’s published registration guidance on September 13, 2026.
The registration window that Texas has been building toward since 2025 is now open. On September 1, 2026, the Texas Office of Consumer Credit Commissioner began accepting Commercial Sales-Based Finance registration applications through the Nationwide Multistate Licensing System. Every non-exempt merchant cash advance funder and every broker arranging those deals for Texas businesses has until December 31, 2026 — 108 days from today — to be registered.
For the companies writing the advances, this is a compliance project. For the Texas business owner already inside an advance, it is something narrower and more useful than most of the coverage suggests: a public registry, a set of contract-level rules that took effect months ago, and a complaint channel with a real regulator behind it. What it is not is a way to make an existing advance disappear. That distinction is where a lot of the writing on this statute goes wrong, and it is worth getting right before you act on anything.
The dates that matter
| Date | What happened or happens |
| June 20, 2025 | Governor Abbott signs HB 700, adding Chapter 398 to the Texas Finance Code. |
| September 1, 2025 | Chapter 398 takes effect, including the disclosure obligations, the automatic-debit restriction, and the confession-of-judgment bar. |
| July 9, 2026 | The OCCC’s implementing rules at 7 TAC §§86.301–86.322 take effect, including the required OCCC complaint notice in contracts. |
| September 1, 2026 | NMLS begins accepting CSBF registration applications. Application checklists published. |
| December 31, 2026 | Registration deadline for providers and brokers already doing business in Texas. |
| January 31, 2027 | First annual renewal due date; the renewal window runs November 1 through December 31 each year. |
What Chapter 398 actually regulates
Texas Finance Code Chapter 398 governs commercial sales-based financing. The statutory definition turns on how the money comes back: financing repaid as a percentage of a business’s sales or revenue, or through payments that are periodically adjusted based on that revenue. That is the defining mechanic of a merchant cash advance. Fixed-payment commercial term lending sits outside it.
Two features of the scope are worth pausing on, because they close doors that funders have historically used.
First, the chapter reaches brokers as well as providers. A person who, for compensation, obtains or offers to obtain commercial sales-based financing for a recipient is a broker under §398.001(2), and brokers register on the same timeline. The ISO layer that sits between the merchant and the funder is inside the statute, not outside it.
Second, the duty follows the Texas merchant rather than the funder’s office address. A company reaching Texas recipients over the internet is covered whether or not it keeps a Texas location. There is no de minimis carve-out for small volume — a point where Texas diverges from Connecticut and Virginia, both of which exempt providers below a transaction threshold. Banks, credit unions, and certain affiliated entities are excluded by §398.003.
If you want the wider picture of how Texas compares to the other states now regulating this product, our overview of merchant cash advance laws by state tracks the full set.
How the registration works
Per the OCCC’s Commercial Sales Based Finance page, applications are submitted through NMLS — the same national platform used for mortgage licensing. A company with an existing NMLS account applies through it; a company without one must create an account using IRS documentation that matches the entity name and FEIN exactly. The registration becomes active once the OCCC receives the initial fee, and in NMLS the registration is treated as the Company License.
The adopted rules at 7 TAC Chapter 86, Subchapter C fill in the rest. Under §86.307, the initial registration fee is $1,000, with a $1,000 annual renewal, both adjustable for inflation. Registrations run a one-year term. Under §86.302, applicants must identify their key individuals — owners of 10 percent or more and control persons — and §86.322 allows revocation on criminal history grounds. The application discloses fraud judgments and prior cease-and-desist history, which means the registry will carry more than a name and an address.
One point that gets garbled often: registration is not capped by transaction size. The $1 million ceiling in Chapter 398 applies to which transactions require the written cost disclosure. It does not create a class of funders who can skip registering because their deals are large.
The part most coverage gets wrong
Search “Texas MCA registration” right now and you will find pages telling Texas business owners that a funder’s failure to register makes the advance void, voidable, or unenforceable. That is not what the statute says, and acting on it is a good way to lose a case you could have defended on other grounds.
Chapter 398 is enforced by the OCCC and no one else. Section 398.101 authorizes an administrative penalty of up to $10,000 per violation, assessed by the Commissioner. The chapter creates no private right of action. A merchant cannot sue a funder for failing to register, cannot recover statutory damages for a defective disclosure, and cannot use either failure as an affirmative defense that voids the agreement.
This is not a Texas quirk. It is the pattern across the states that have legislated here. Florida’s Commercial Financing Disclosure Law reserves enforcement to the Attorney General and states expressly that a violation does not render the transaction void or unenforceable. Utah’s Commercial Financing Registration and Disclosure Act works the same way through the Department of Financial Institutions. Three states, three statutes, one structure: the regulator can fine the funder, and the contract stands.
There is exactly one provision in Chapter 398 that operates at the contract level, and it is §398.055, which makes confession-of-judgment provisions and similar provisions void and unenforceable. That provision is worth its own treatment and we cover it separately in our reporting on confessions of judgment in merchant cash advance agreements. It is the exception that demonstrates the rule: when the Texas Legislature wanted a term to be void, it said so in plain language, and it said so about one term only.
What Chapter 398 does give a Texas merchant
Set aside the void-contract theory and there is real substance here — most of it already in force since September 2025 or July 2026, with none of it waiting on the December deadline.
The automatic-debit restriction
Section 398.056, implemented at §86.313, bars a provider or broker from establishing a mechanism to automatically debit a recipient’s deposit account to recoup receivables unless the provider holds a validly perfected first-priority security interest in all of the recipient’s accounts receivable. The rule reaches prewritten checks, recurring pre-authorizations, and arrangements running through third-party payment processors.
Read that against how the market is actually built. A merchant with three or four stacked advances cannot, by definition, have granted first-priority in the same receivables to all of them. Most sales-based financing programs were never designed around a perfected first lien at all. That makes the security-interest question a concrete, checkable fact rather than a theory — one that starts with pulling the UCC-1 filings against the business and reading what was actually perfected and in what order. Our guides on how to stop MCA daily withdrawals and on MCA UCC lien removal walk through both halves of that analysis.
The caution attaches here too: §398.056 is still OCCC-enforced. Establishing an unlawful debit mechanism exposes the funder to administrative penalties. It does not, standing alone, hand the merchant a claim. What it does is give the facts a home — in a complaint to the regulator, in negotiation, and in the record of a collection case where the same lien question is already in play.
The complaint notice now required in the contract
Since July 9, 2026, §86.310(d) has required a sales-based financing contract to carry an OCCC complaint notice, conspicuously set out from the surrounding text, directing the recipient to the Office of Consumer Credit Commissioner, 2601 N. Lamar Blvd., Austin, Texas 78705, (800) 538-1579, occc.texas.gov. If you signed a Texas advance after July 9 and the notice is not in the document, that is itself reportable.
The recordkeeping rule
Section 86.311 requires providers to maintain records including payment application history and lien perfection documentation, with retention periods running four years and two years depending on the record. In a collection posture, a rule that obligates the funder to keep a payment-application history and its perfection documents is a discovery lever — it establishes that the documents exist and are supposed to be retrievable. That matters when the dispute is about how much has actually been collected, which is a common fact pattern in merchant cash advance lawsuit defense.
The prohibited practices list
Section 86.312(b) enumerates fifteen practices treated as unfair, deceptive, or abusive. For a merchant assembling a factual record, it functions as a checklist of conduct the state has already named — useful when you are working out which merchant cash advance legal defenses the facts actually support.
The written cost disclosure
For covered transactions under $1 million, a specific offer must arrive with a written disclosure: total amount of financing, disbursement amount, finance charge as a dollar figure, total repayment amount, payment amounts and the period over which payments equal the repayment amount, prepayment fees not included in the finance charge, collateral and security interest requirements, and whether the provider pays compensation to a broker and how much.
Texas notably does not mandate an APR expression, and §398.005(d) bars the Finance Commission from setting any maximum APR, finance charge, or fee. This is a meaningful divergence from California, which under SB 362 began requiring APR expression for commercial financing disclosures on January 1, 2026. Texas priced the paperwork; it did not price the product. If you are trying to work out what an offer costs on an annualized basis, you will have to do that arithmetic yourself — our merchant cash advance calculators are built for exactly that.
The transition period, and why an empty registry search this fall proves little
There is a gap in the record worth stating plainly rather than papering over. Chapter 398’s registration duty existed from September 1, 2025. The fee rule, the application form, and the NMLS pathway did not exist until July 9 and September 1, 2026 respectively. The OCCC has not published guidance on how it will treat companies that wrote Texas business during that interval.
The practical consequence for a merchant checking on a funder: an absent registration in October 2026 tells you very little. A company missing from the registry today may simply not have filed yet, which is permitted until December 31. The same search run in January 2027 is a different piece of information entirely — at that point a company writing Texas deals without a registration is accruing exposure under §398.101.
To check, use the OCCC’s public licensee search against the funder’s legal entity name rather than its marketing brand. Advances are frequently written under an entity name the merchant has never seen on a website.
What registration does and does not mean
| A Texas CSBF registration means | It does not mean |
| The entity is identified to the state, with key individuals at 10% or more disclosed. | The OCCC has reviewed or approved the pricing of the product. |
| Fraud judgments and cease-and-desist history were disclosed on the application. | The funder has a clean record — disclosure is not the same as absence. |
| The company is subject to OCCC examination, recordkeeping rules, and penalties. | A merchant gains a private claim or a defense to repayment. |
| There is a named regulator to complain to, with an address in the contract. | A complaint stops daily debits, a lawsuit, a levy, or a UCC lien on its own. |
| Renewal is annual, so the registry stays current rather than going stale. | Registration validates the specific agreement the merchant signed. |
Where this leaves a Texas business owner
If you are current on an advance and simply want to know who you are dealing with, the registry becomes genuinely useful in January. Note the funder’s legal entity name now so you can search it then.
If you are behind, or the daily debits have stopped being survivable, the Chapter 398 calendar is not the thing driving your timeline. A default under a merchant cash advance moves on the funder’s schedule, not the state’s, and the consequences that follow — a frozen business bank account, a UCC lien on receivables, a collection suit — have their own deadlines that are usually measured in days. Understanding what a default actually triggers matters more right now than the registration status of the company that funded you.
Where Chapter 398 does become part of the conversation is in the details: whether a first-priority perfected interest in all receivables actually exists, whether the disclosure arrived with the offer, whether the required notice is in the contract, whether the funder can produce the payment application history it is obligated to keep. Those facts do not void an agreement. They do shape the posture of a merchant cash advance settlement discussion, and they belong in front of a lawyer who handles this product rather than in a demand letter written from a template.
Frequently asked questions
Does my MCA contract become void if the funder is not registered by December 31, 2026?
No. Chapter 398 gives enforcement authority to the Office of Consumer Credit Commissioner and creates no private right of action. An unregistered provider faces an administrative penalty of up to $10,000 per violation under §398.101. The agreement itself remains enforceable.
Can I sue my funder for violating Chapter 398?
Not under Chapter 398 itself. The chapter provides no private cause of action. Whether other Texas or federal claims are available depends entirely on the facts of your agreement and your dealings with the funder, which is a question for a Texas attorney reviewing your documents.
What is the one provision that does affect my contract?
Section 398.055 makes confession-of-judgment provisions and similar provisions void and unenforceable. That is the single contract-level remedy in the chapter, and it is the exception rather than the pattern.
Does this apply to brokers and ISOs, or only to funders?
Both. A person who obtains or offers to obtain commercial sales-based financing for a recipient in exchange for compensation is a broker under the statute and registers on the same December 31, 2026 deadline.
My funder has no Texas office. Does Chapter 398 still reach it?
The registration duty follows the Texas recipient rather than the provider’s physical location, and it extends to companies reaching Texas businesses over the internet. Whether a particular company is covered or exempt under §398.003 is a fact question.
Is there a small-volume exemption?
No. Texas did not adopt a de minimis threshold, which distinguishes it from Connecticut and Virginia. Banks, credit unions, and certain affiliated entities are excluded under §398.003, but volume alone does not exempt a provider.
Does Texas require an APR disclosure?
No. The written disclosure requires a finance charge expressed as a dollar amount along with the other enumerated items, but no APR. Section 398.005(d) also bars the Finance Commission from setting a maximum APR, finance charge, or fee.
How do I check whether a funder is registered?
Search the OCCC’s public licensee database using the funder’s legal entity name, not its trade name. Keep the timing in mind: a company absent from the registry before December 31, 2026 may still be within the compliance window, so the search is far more informative in January 2027.
The automatic-debit rule sounds like it should stop my daily payments. Does it?
Not by itself. Section 398.056 restricts when a provider may lawfully establish an automatic debit mechanism, and the enforcement of that restriction runs through the OCCC. Stopping withdrawals that are already running is a separate question involving your bank, your agreement, and in some cases a court.
Should I file a complaint with the OCCC?
That depends on what you are trying to accomplish, and it is worth discussing with a Texas attorney first — particularly if you are in or near litigation, where the timing and content of a regulatory complaint can matter. The OCCC’s contact details are required to appear in the contract itself for agreements executed on or after July 9, 2026.
Primary sources
- Texas Finance Code Chapter 398, Commercial Sales-Based Financing — Texas Legislature Online
- Commercial Sales Based Finance — Texas Office of Consumer Credit Commissioner
- Adopted Rules, Title 7, Part 5, Chapter 86 — Texas Register, July 3, 2026
- Adopted rules with agency responses to comments (PDF) — Texas Register
- OCCC Commercial Sales-Based Financing Rules, advance notice (PDF) — OCCC
Reviewing a Texas merchant cash advance?
CredibleLaw connects business owners with independent attorneys who handle merchant cash advance matters. A free case review covers your agreement, the UCC filings against your business, and what the facts actually support — before anything gets filed. Call 888-201-0441.
About CredibleLaw. CredibleLaw is a national legal resource and attorney referral network. It is not a law firm and does not provide legal services, legal advice, or representation. This article is general information about Texas law as of September 14, 2026 and is not legal advice about any specific agreement or dispute. Statutes, rules, and agency guidance change. For advice on your situation, consult a licensed Texas attorney. Attorneys who receive referrals through CredibleLaw are independent and are solely responsible for the services they provide.
