Senate Bill 784 would restrict Californians’ access to safe, responsible and affordable capital for critical home improvement projects

Sacramento, CA (April 23, 2025) – The American Fintech Council (AFC), the premier industry association representing responsible fintech companies and innovative banks, sent a letter to the California Senate Judiciary Committee expressing concerns with Senate Bill 784 (SB 784), warning that the legislation would severely limit consumer access to responsible home improvement loans. AFC emphasized that if passed, the bill’s intended consumer protection provisions would instead lead to drastically higher prices and decreased optionality for California borrowers as a result of increased costs and risks for responsible home improvement loan originators in the state.

“This legislation threatens to damage California’s financial ecosystem and drastically reduce access to affordable capital,” said Phil Goldfeder, Chief Executive Officer of AFC. “SB 784 would create roadblocks for Californians looking to finance crucial home improvement projects and, if passed, will lead to higher prices and harm the very consumers the legislation intends to help.”

AFC’s letter raises several areas of concern with SB 784. First, lenders must confirm projects have final permits and obtain both written and oral consent from the borrower that the project is “operational” prior to seeking repayment. Additionally, consumers have no repayment obligation under a home improvement loan until a lender “has taken specified actions.” These two provisions increase lender risk and may result in stricter lending terms. Further, the bill increases lender liability beyond provisions outlined in the federal Holder Rule, disincentivizing lenders in the state, reducing competition, and severely limiting safe and responsible consumer options.

AFC also expressed concerns about provisions requiring outdated, analog interactions between lender and borrower, including hard copies of forms, verbal consent, and confirmation calls. These requirements place modern lenders and responsible innovators working to increase financial inclusion at a significant disadvantage. As a result, the bill would hinder the accessibility and convenience of fintech loans and further expose Californians to decreased optionality and higher prices.

“Responsible fintech lenders have democratized financial services and increased access to affordable loans for families who have been historically underserved by traditional lenders,” said Ashley Urisman, Director of State Government Affairs at AFC. “Decreasing the availability of these products and services would severely limit safe loan options for these populations, at best exposing them to higher prices and at worst prohibiting them entirely from financing projects critical to maintaining their homes.”

A standards-based organization, AFC is the premier trade association representing the largest financial technology (Fintech) companies and innovative banks offering embedded finance solutions. AFC’s mission is to promote a transparent, inclusive, and customer-centric financial system by supporting responsible innovation in financial services and encouraging sound public policy. AFC members foster competition in consumer finance and pioneer products to better serve underserved consumer segments and geographies.

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