Payday Loan Reform
LWVAL Action Priority Level III - Issues identified by LWVAL Advocacy Committee and/or State Board or Local Leagues. Monitoring occurs; action dependent on opportunity and available resources.Click a bill to see sponsor(s), synopsis, link to the bill, League action and justification for that action, and progress of the bill through the legislative process.
Legend:
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= LWVAL's opposition to the legislation.
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LWVAL has taken a position on this bill:
SB138 - Deferred presentment transactions, term set at 30 days, Sec. 5-18A-13 am'd. CALL TO ACTION ISSUED 02/02/2018!
Sponsor(s): Senators Orr, Holtzclaw, Williams and Smitherman
Synopsis and Analysis: This is a bill to increase the minimum term of a payday loan from 10 days to 30 days, thereby cutting the allowable APR on the average payday loan in half (from 456% to 228%).
This bill changes only one line in the existing Deferred Presentment Act governing payday loans: the minimum term of the loan shall be increased from less than 2 weeks (10 days) to one full month (30 days).
This change would effectively cut the annualized rate of interest in half and would reduce the need for borrowers to rollover their loans, or re-borrow the same money again, accruing additional fees every 2 weeks.
League Action and Justification: Support. Although this does not get the interest rate down to 36%, as recommended in our League position, it does extend the time for repayment of the loan before a new fee is applied, which was one of the conditions the State League required for support. Our position statement said we wanted "some or all of the following [[provisions] as part of payday loan reform."
01/02/2018 - LWVAL ISSUES CALL TO ACTION ON SB138.
UPDATE 2/13/18: We ask that citizens call members of the Senate Banking & Insurance Committee and urge their support for SB138. Please call before THURSDAY, FEB. 15, 2018. Get more information at http://www.lwval.org
UPDATE 2/15/18: Senate B&I passed SB138 favorably out of committee. Good work action callers!
UPDATE 3/8/18: SB138 has passed the AL Senate and now moves on to the House with the same bill number.
Update 3/21/18: LWVAL issues a last call to action to pass SB138. Call House Financial Services Committee and urge favorable vote out of committee and vote of the full House.
Bill Progress in Legislature:
Senate
01/11/2018 - Read for the first time and referred to the Senate Committee on Banking & Insurance (B&I)
2/15/18 - Senate B&I passed SB138 favorably out of committee.
2/20/2018 - Pending third reading on day 14; Favorable from B&I
03/08/2018 - Third Reading Passed
03/08/2018 - Motion to Read a Third Time and Pass adopted
House
03/08/2018 - Read for the first time and referred to the House Committee on Financial Services (FS); Pending committee action in 2nd house
Synopsis and Analysis: This is a bill to increase the minimum term of a payday loan from 10 days to 30 days, thereby cutting the allowable APR on the average payday loan in half (from 456% to 228%).
This bill changes only one line in the existing Deferred Presentment Act governing payday loans: the minimum term of the loan shall be increased from less than 2 weeks (10 days) to one full month (30 days).
This change would effectively cut the annualized rate of interest in half and would reduce the need for borrowers to rollover their loans, or re-borrow the same money again, accruing additional fees every 2 weeks.
League Action and Justification: Support. Although this does not get the interest rate down to 36%, as recommended in our League position, it does extend the time for repayment of the loan before a new fee is applied, which was one of the conditions the State League required for support. Our position statement said we wanted "some or all of the following [[provisions] as part of payday loan reform."
01/02/2018 - LWVAL ISSUES CALL TO ACTION ON SB138.
UPDATE 2/13/18: We ask that citizens call members of the Senate Banking & Insurance Committee and urge their support for SB138. Please call before THURSDAY, FEB. 15, 2018. Get more information at http://www.lwval.org
UPDATE 2/15/18: Senate B&I passed SB138 favorably out of committee. Good work action callers!
UPDATE 3/8/18: SB138 has passed the AL Senate and now moves on to the House with the same bill number.
Update 3/21/18: LWVAL issues a last call to action to pass SB138. Call House Financial Services Committee and urge favorable vote out of committee and vote of the full House.
Bill Progress in Legislature:
Senate
01/11/2018 - Read for the first time and referred to the Senate Committee on Banking & Insurance (B&I)
2/15/18 - Senate B&I passed SB138 favorably out of committee.
2/20/2018 - Pending third reading on day 14; Favorable from B&I
03/08/2018 - Third Reading Passed
03/08/2018 - Motion to Read a Third Time and Pass adopted
House
03/08/2018 - Read for the first time and referred to the House Committee on Financial Services (FS); Pending committee action in 2nd house
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