HB535 Summary

• No person may engage in deferred presentment services (payday loans) by mail, telephone, Internet, or in person without a license from the Supervisor of the Bureau of Loans; violations are void and unenforceable.

• Licensees may charge a maximum fee of 17.5 percent of the amount advanced, with a maximum loan amount of $500; after two continuous transactions with the same customer, licensees cannot enter into new transactions until 48 hours after full repayment.

• If a customer cannot repay after the initial loan period and one rollover, licensees must offer a free extended repayment plan of up to 60 days with four equal monthly installments and no interest or fees; borrowers receive one mandatory extended repayment plan per 12-month period.

• Borrowers using repayment plans must receive financial literacy and education materials or referrals to approved financial counseling at no cost; licensees cannot enter into new deferred presentment transactions while a customer is on a repayment plan.

• After a customer completes six successful deferred presentment transactions within 12 months, licensees must inform them of available installment loan products; after 12 transactions within 12 months, a 14-day waiting period applies before new transactions.

• Bill becomes effective January 1, 2018.