HB 1317 Summary

• Establishes the Hawaii credit creation pilot program within the Department of Commerce and Consumer Affairs Division of Financial Institutions to provide unsecured consumer loans between $600 and $5,000 with a minimum term of 120 days.

• Caps interest rates at 36% annually on simple interest basis and limits administrative fees to 7% of principal or $90 (whichever is less), with delinquency fees capped at $14 for 7+ days late or $20 for 14+ days late.

• Requires licensees to conduct underwriting to ensure borrowers' total monthly debt service payments do not exceed 50% of gross monthly income and to report loan payment performance to at least one consumer reporting agency.

• Permits use of referral partners to facilitate loans, with referral partner fees capped at $60 per loan and prohibits passing these fees to borrowers; referral partners must comply with disclosure requirements and prohibited activities.

• Requires annual legislative reports on program status including loan volume, delinquencies, credit score improvements, and violations; pilot program expires June 30, 2022.