Code of Ethics
Preamble
Whereas, The MCA Association (the “Association”), its board, and its members represent a wide range of financing platforms and solutions for small businesses and various other stakeholders in the small business economy;
Whereas, small businesses rely on access to capital in order to manage liquidity, hire employees, capitalize on business opportunities, and make other important investments in their economic futures;
Whereas, our members believe in and aim to contribute to the important role that small businesses play in driving the growth of the economy and its overall success;
Whereas, the ability to access capital through a streamlined and painless process is paramount to the success of a small business;
Whereas, the best way to service a small business’s financial needs is through programs and services that are specifically created for small businesses;
Whereas, small businesses benefit from access to a wide variety of competing services, programs, and products from traditional depository institutions as well as non-depository financing providers;
Whereas, modern technology and innovations allow a wider array of small businesses to access a wider array of financial services and products;
Whereas, access to the most accurate, up-to-date information is crucial to informed decision-making when shopping for financial products and services;
Resolved hereto, our Members are committed to the following best practices to ensure small business’s sustained access to capital:
Best Practices
In order to ensure the growth, success, and integrity of the small business lending industry, the Association has set forth the following best practices for its members involved in providing, facilitating, and supporting the provision of capital to small businesses.
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Transparency
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Disclosures should contain comprehensive and accurate information on fees, structure, repayment terms, total amounts owed, collateral and security requirements.
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Disclosures should enable a small business to adequately assess all aspects and terms of the financial products and services they seek.
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Terms that should be openly and plainly be disclosed to a potential borrower:
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Structure and type of contract
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Upfront fees and charges incurred as a condition of receipt of capital
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Future fees or charges, whether or not they are certain to be incurred
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Net proceeds available to the applicant after all fees and charges
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Structure and timeline for delivery of capital
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Structure and timeline for repayment
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Total repayment amounts including any fees or costs incurred with early or late repayment
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Consequences and terms of default
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Terms for renewal or refinancing
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Any other key terms that are material to the product or service offered
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Fairness
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No unreasonable pressure to accept an offer
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Accurate representations, advertisements, marketing and sales materials, and solicitation.
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Full and fair disclosure of key terms
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Adequate measures in place to protect the privacy and security of the customer
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Clear and conspicuous disclosure of how any customer information may be used
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Adherence to applicable NACHA Operating Rules and Guidelines
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Fair and good-faith treatment of customers facing financial hardship
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Responsibility
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Strict adherence to all applicable federal and state lending laws
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Catering financial products that increase financial health and stability and avoid destructive debt cycles
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Creating financial solutions that adequately prioritize a business’s financial needs and limitations over the ability to earn higher commissions or fees
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Proper and adequate vetting of third-party brokers and referrers of financial products
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Commitment to decreasing fraud and avoidance of participation in illegal or criminal schemes
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Education
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Ensuring that this code of conduct is adequately reflected in employee trainings, company policies, and other legal agreements
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Establishing procedures for reporting violations of this code of conduct
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