Senate Bill 431 Summary

• Establishes the "Small Loan Regulatory Act" requiring licensure of entities providing small loans up to $2,500 with terms up to 730 days, effective June 1, 2018.

• Imposes licensing requirements including minimum $50,000 net worth per location (capped at $250,000 total), $50,000 surety bond, and demonstration of financial responsibility and fitness.

• Caps monthly finance charges using a tiered rate structure: 15% on first $500, 14% on second $500, down to 11% on fifth $500, calculated using simple interest method.

• Requires establishment of a statewide database by June 1, 2018 to track open small loans and prevent borrowers from having multiple concurrent loans; restricts scheduled payments plus deferred presentment transactions to 20% of monthly gross income.

• Allows borrowers to rescind loans within one business day by repaying principal, provides default cure rights with 20-day notice period, and permits customers to file complaints with the Department of Insurance and Financial Services for violations and restitution.