Assembly Bill A9603

2015-2016 Legislative Session

Prohibits foreign banking corporations from issuing payday loans

download bill text pdf

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Archive: Last Bill Status - In Assembly Committee

  • Introduced
    • In Committee Assembly
    • In Committee Senate
    • On Floor Calendar Assembly
    • On Floor Calendar Senate
    • Passed Assembly
    • Passed Senate
  • Delivered to Governor
  • Signed By Governor

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2015-A9603 (ACTIVE) - Details

See Senate Version of this Bill:
S4458
Current Committee:
Assembly Banks
Law Section:
Banking Law
Laws Affected:
Add §202-k, Bank L; add §5-532, Gen Ob L
Versions Introduced in Other Legislative Sessions:
2009-2010: A1484
2011-2012: A3288
2013-2014: A2962, S4036
2017-2018: S3699
2019-2020: S3241
2021-2022: S5774
2023-2024: S2649

2015-A9603 (ACTIVE) - Summary

Prohibits foreign banking corporations from issuing payday loans; defines payday loans as any transaction in which a short-term cash advance is made to a consumer in exchange for (i) a consumer's personal check or share draft, in the amount of an advance plus a fee, where presentment or negotiation of such check or share draft is deferred by agreement of the parties until a designated future date; or (ii) a consumer's authorization to debit the consumer's transaction account, in the amount of the advance plus a fee, where such account will be debited on or after a designated future date.

2015-A9603 (ACTIVE) - Bill Text download pdf 

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  9603

                          I N  A S S E M B L Y

                             March 21, 2016
                               ___________

Introduced  by M. of A. HYNDMAN -- read once and referred to the Commit-
  tee on Banks

AN ACT to amend the banking law and  the  general  obligations  law,  in
  relation  to prohibiting foreign banking corporations from engaging in
  high-cost payday loans

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The banking law is amended by adding a new section 202-k to
read as follows:
  S  202-K.  PROHIBITION  OF PAYDAY LOANS.  1. NO FOREIGN BANKING CORPO-
RATION SHALL MAKE ANY PAYDAY LOAN, EITHER  DIRECTLY  OR  INDIRECTLY,  OR
MAKE  ANY  LOAN  TO  ANY OTHER LENDER FOR PURPOSES OF FINANCING A PAYDAY
LOAN OR REFINANCING OR EXTENDING ANY PAYDAY LOAN.
  2. FOR PURPOSES OF THIS SECTION "PAYDAY LOAN" MEANS ANY TRANSACTION IN
WHICH A SHORT-TERM CASH ADVANCE IS MADE TO A CONSUMER  IN  EXCHANGE  FOR
(I)  A  CONSUMER'S  PERSONAL  CHECK  OR SHARE DRAFT, IN THE AMOUNT OF AN
ADVANCE PLUS A FEE, WHERE PRESENTMENT OR NEGOTIATION OF  SUCH  CHECK  OR
SHARE  DRAFT  IS DEFERRED BY AGREEMENT OF THE PARTIES UNTIL A DESIGNATED
FUTURE DATE; OR (II) A CONSUMER'S AUTHORIZATION TO DEBIT THE  CONSUMER'S
TRANSACTION ACCOUNT, IN THE AMOUNT OF THE ADVANCE PLUS A FEE, WHERE SUCH
ACCOUNT WILL BE DEBITED ON OR AFTER A DESIGNATED FUTURE DATE.
  S  2.  The  general obligations law is amended by adding a new section
5-532 to read as follows:
  S 5-532. PROHIBITION ON PAYDAY LOANS.  1. A CREDITOR MAY  NOT  MAKE  A
PAYDAY  LOAN TO ANY PERSON IF THE CREDITOR KNOWS OR HAS REASONABLE CAUSE
TO BELIEVE THAT:
  A. THE PERSONAL CHECK OR SHARE DRAFT THE CREDITOR  RECEIVES  FROM  THE
PERSON,  IN  EXCHANGE  FOR  THE  LOAN, IS DRAWN ON AN INSURED DEPOSITORY
INSTITUTION OR INSURED CREDIT UNION; OR
  B. THE ACCOUNT THE CREDITOR RECEIVES PERMISSION  FROM  THE  PERSON  TO
DEBIT, IN EXCHANGE FOR THE LOAN, IS A TRANSACTION ACCOUNT OR SHARE DRAFT
ACCOUNT AT AN INSURED DEPOSITORY INSTITUTION OR AN INSURED CREDIT UNION.
  2. FOR PURPOSES OF THIS SECTION:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05290-01-5

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