New California EFT law: Understanding BPC § 25509 in 2026 and Staying Compliant

February 2026 Update – As of January 1, 2026, significant changes to California's alcoholic beverage payment regulations are now in effect. These updates, driven by Assembly Bill 2991 (2024), modernize how wholesalers and retailers handle transactions while preserving longstanding tied-house restrictions designed to prevent undue influence in the industry.

If you're a wholesaler, importer, or retailer dealing in beer, wine, or distilled spirits in California, these rules directly impact your cash flow, administrative workload, and compliance obligations. At Paidnice, we help beverage businesses automate accounts receivable processes, and these changes make tools like ours more valuable than ever.

Is This Law Only for Alcoholic Beverages?

Yes, absolutely. Business and Professions Code §§ 25509 and 25509.1 apply exclusively to transactions involving beer, wine, and distilled spirits between licensed wholesalers (or manufacturers/importers) and retail licensees (on-sale or off-sale).

This is not a general wholesale payment law. It falls under Division 9 of the Business and Professions Code (Alcoholic Beverages) and Chapter 15 (Tied-House Restrictions). Payments for non-alcohol products, even from the same wholesaler to the same retailer, remain governed by standard commercial credit terms and do not trigger these mandatory EFT rules or specific delinquency penalties.

The goal is to maintain fair competition in the highly regulated three-tier alcohol system while bringing payment practices into the digital age.

Key Changes Under the Updated Law

The core rules are now split across two sections:

§ 25509 – Delinquency Penalties and Credit Restrictions

• Payment is due within 30 days of delivery (with extensions if the due date falls on a weekend/holiday).
• If not paid by day 42, the wholesaler must charge a 1% late fee on day 43.
• An additional 1% late fee applies every 30 days thereafter on the unpaid balance.
• If the account becomes delinquent (payment not received by day 30 or late fees unpaid), all future deliveries must be prepaid (cash, check, or allowed alternatives) until the account is brought current.
• Payments are applied to the oldest invoices first.

These penalties are mandatory, wholesalers cannot waive them without risking their own license compliance.

§ 25509.1 – Mandatory Electronic Funds Transfer (EFT)

• For deliveries on or after January 1, 2026, payment must generally be by EFT, initiated by the wholesaler (a "pull" from the retailer's bank account).
• The transfer must occur no later than the 30th day after delivery.
• Each party bears its own banking/processing fees, and fees must be equitable.
• The wholesaler selects (or mutually agrees on) the third-party processor.
• Limited exceptions allow cash/check: new licensees (first 30 days), temporary permits, processor outages, or after a failed EFT.

Credit cards are optionally allowed (with the retailer covering processing fees).

Practical Impact: What This Means Day-to-Day

For wholesalers:

• You must track delivery dates precisely and automate delinquency calculations.
• Missing a required 1% charge or failing to switch a delinquent account to prepay could expose you to ABC enforcement.
• Setting up EFT pulls requires secure banking authorizations from every retailer — a big administrative lift if done manually.
• Faster, more predictable cash flow is a clear upside, but only if your systems can handle the compliance details.

For retailers:

• Expect stricter enforcement of the 30-day terms.
• Late payments now compound quickly with mandatory fees.
• You'll need to provide banking details for EFT pulls and ensure sufficient funds to avoid failed transfers (which revert to cash/check).

Both sides benefit from reduced check-processing hassles and bad-payment risks, but the transition requires reliable systems.

How Paidnice Helps You Comply

At Paidnice, we built our AR automation platform specifically for businesses using Xero or QuickBooks, and many alcohol wholesalers already rely on us to manage invoicing, reminders, and collections.

Here's how Paidnice makes the new § 25509 rules practically effortless:

• Automated Delinquency Charges: Our flexible rules engine lets you configure exact 1% fees on day 43, then every 30 days — matching the law precisely. No manual calculations or missed charges.
• Prepayment Enforcement: Flag delinquent accounts automatically and block credit sales until paid current. Integrate with your sales team or order system for real-time enforcement.
• Payment Reminders & Self-Service Portal: Send branded, timed reminders that drive on-time payments. Retailers can log in to a secure portal, view invoices, and pay quickly (via integrated Stripe, supporting ACH/EFT options).
• Cash Flow Visibility: Real-time dashboards show aging balances, upcoming delinquency triggers, and prepay status — so you catch issues early.
• Compound Interest & Statements: If you layer additional late fee or finance charges (where allowed), we handle compounding automatically.

While Paidnice focuses on automation and payment facilitation, pairing us with your chosen EFT processor ensures the wholesaler-initiated pulls required under § 25509.1 happen smoothly. Many of our customers report dramatically fewer late payments and less administrative overhead.

Final Thoughts

California's updated alcohol payment rules are a win for modernizing the industry while protecting its regulatory framework. The shift to mandatory EFT and strict delinquency penalties rewards wholesalers who invest in solid AR processes, and puts pressure on those relying on spreadsheets or manual tracking.

If you're ready to turn compliance into a competitive advantage (faster cash, fewer disputes, happier retailer relationships), Paidnice is here to help. Book a demo today and see how quickly we can get your delinquency rules, reminders, and collections running on autopilot.

Questions about the law or how automation fits your workflow? Contact us to learn more, we're happy to help.

This post is for informational purposes only and not legal advice. Consult your attorney or the California Department of Alcoholic Beverage Control for specific guidance.