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A California law, set to take effect on January 1, 2022, may restrict the ability of colleges and universities to collect debts from its residents. The Debt Collection Licensing Act (DCLA) states that no person or organization shall engage in the business of debt collection in California without first obtaining a license.

NACUBO and several other organizations have received conflicting information on the applicability of this law as it relates to colleges and universities. Until a resolution is reached, the NACUBO policy team encourages business officers to monitor the situation, and to consider reviewing the issue with legal counsel.

However, independent of whether colleges and universities will be required to comply with the law, schools that utilize debt collection agencies will want to ensure that those companies are in compliance with DCLA.

If it is determined that colleges and universities fall within the scope of the law, institutions will need
to decide if they will register with the State of California.

NACUBO staff will provide updates when additional information is made available.

Contact

Bryan Dickson

Director, Student Financial Services and Educational Programs

202.861.2505


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