(a) Covered credit transaction means an extension of business credit
that is not an excluded transaction under paragraph (b) of this section.
(b) Excluded transactions. The requirements of this subpart do not apply to:
(1) Trade credit. A financing arrangement wherein a business acquires goods or services
from another business without making immediate payment in full to
the business providing the goods or services.
(2) Home Mortgage
Disclosure Act (HMDA)-reportable transactions. A covered loan,
or application therefor, as defined by Regulation C, 12 CFR 1003.2(e).
(3) Insurance premium financing. A financing arrangement wherein
a business agrees to pay to a financial institution, in installments,
the principal amount advanced by the financial institution to an insurer
or insurance producer in payment of premium on the business’s
insurance contract or contracts, plus charges, and, as security for
repayment, the business assigns to the financial institution certain
rights, obligations, and/or considerations (such as the unearned premiums,
accrued dividends, or loss payments) in its insurance contract or
contracts. Insurance premium financing does not include the financing
of insurance policy premiums obtained in connection with the financing
of goods and services.
(4) Public utilities credit. Public
utilities credit as defined in section 1002.3(a)(1).
(5) Securities
credit. Securities credit as defined in section 1002.3(b)(1).
(6) Incidental credit. Incidental credit as
defined in section 1002.3(c)(1), but without regard to whether the
credit is consumer credit, as defined in section 1002.2(h).
