Virginia Legislation

What legislation was passed in Virginia?

Effective Friday, July 1, 2022 the Commonwealth of Virginia requires commercial financing providers to deliver a “Sales-Based Financing Disclosure Form” to small businesses in their state before entering into a revenue-based financing transaction. Because Forward Financing provides this type of product, we must follow this law and have each Virginia customer sign a disclosure form.

What does the disclosure form look like?

We have provided an example of the disclosure form, including some helpful explanation.

What will small business owners need to do?

Forward Financing is required to obtain a signed disclosure form from customers with a business address in the Commonwealth of Virginia. While Forward takes great care to ensure our contract is clear and comprehensive, Virginia is requiring a separate form for all “sales-based” financing.

Every small business in Virginia will receive the disclosure form at the same time they receive their contract (since this is when they’ll first receive an offer that binds Forward). It must be signed by the same party that sign the contract.

If the customer chooses to pay their balance early, an updated disclosure form will be sent to them for signature.

  • In most cases, whether working with an ISO or directly with Forward, the customer will receive two separate emails simultaneously – one with the disclosure form to e-sign and one with the contract to e-sign.
  • If the ISO elects to send the disclosure form and contract for the customer to manually sign, the ISO must obtain signatures from the customer on both documents, and send them to Forward.
What do ISOs need to know?

Disclosure Requirement

For any customer in Virginia, ISOs are now required by state law to obtain the customer’s signature on the separate Virginia disclosure form – in addition to Forward’s standard customer contract – before funds can be disbursed.

While most of the information on the Virginia disclosure form is also included on the front page of Forward’s contract, the disclosure form also includes broker compensation – the fee paid by Forward Financing to the ISO for connecting us with the customer – as a separate line item.

ISOs should be aware that the Virginia disclosure form:

  • Cannot be altered and is consistent for all “sales-based” financing in the state of Virginia;
  • Must be signed by the same party or parties that sign the funding contract;
  • Will be treated like any other stipulation;
  • Cannot be merged with any other document; it must be its own PDF.


Registration Requirement

The Commonwealth of Virginia will require ISOs to be registered as “sales-based financing brokers” to refer Virginia-based customers for sales-based financing. Learn more at the SCC website under “Sales-based Financing.”

Accordingly, ISOs must provide their Forward Account Manager proof of registration for us to review their VA-based applications submitted after November 1, 2022.

Who can I contact if I have questions?

ISOs are encouraged to contact their Account Manager with any questions regarding Forward’s change in processes related to this Virginia legislation. Further information on the new law can be found here.

Customers working with an ISO and funding with Forward for the first time are encouraged to contact their ISO with questions on any documentation requirements, including this disclosure form. Customers who are working directly with Forward Financing are welcome, as always, to reach out to their Account Executive with any questions or concerns.

Will other states be passing similar legislation?

While none of us know for sure what legislation will or will not be passed, we can share our steadfast commitment to delivering financial opportunity to small businesses and being transparent and ethical in doing so.

We are involved in these discussions and closely monitoring any legislation that could affect our customers and ISOs. We will keep ISOs informed as decisions are made and will help them navigate any changes to how they work with Forward and the customers we share.

This information is not intended to be legal advice; please consult with your own counsel on these issues.