HF4345 - Payday Lending Regulation Summary

• Increases the maximum cash advance for consumer small loans from $350 to $500, with a new fee tier for amounts between $350-$500 charged at 5% of loan proceeds with a $20 minimum plus $5 administrative fee.

• Modifies fee structure for loans under $350, reducing the percentage charge for amounts exceeding $250 (from unspecified to 6% with $17.50 minimum) and maintaining existing charges for smaller amounts.

• Prohibits payday loan contracts from selecting non-Minnesota law, choosing forums outside Minnesota for disputes, or limiting class actions for unlicensed lending or excessive interest rates and fees.

• Requires lenders to furnish written contracts in the borrower's language and display prominently a state-mandated consumer notice explaining that these loan charges are higher than permitted under Minnesota law.

• Updates licensing and reporting requirements for consumer small loan lenders, including annual filings with the commissioner and reporting of material changes within 30 days.