SB410 Alabama 2014 Session

Summary

Primary Sponsor

Arthur OrrSenator

Republican

Co-Sponsors

George M. “Marc” KeaheyBill HoltzclawClay ScofieldDel MarshGerald H. AllenHarri Anne SmithScott BeasonRusty GloverVivian Davis FiguresGreg J. ReedWilliam “Bill” M. BeasleyRodger SmithermanTammy IronsJerry L. FieldingBryan TaylorPriscilla Dunn

Session

Regular Session 2014

Title

Deferred presentment transactions, customer repayment period revised, extensions prohibited, collection of a bad check fee under certain conditions, use of database by licensees required, Secs. 5-18A-2, 5-18A-12, 5-18A-13 am'd.

Summary

SB410 would overhaul Alabama's deferred presentment (payday loan) rules by extending repayment to six months, prohibiting extensions beyond the term, adding a new bad-check fee, and requiring a supervisor-designated database and public reporting.

What This Bill Does

Allows borrowers to repay deferred presentment transactions over six months and prohibits extensions beyond the term, while reducing the extended repayment option from four to three months. Allows licensees to charge a bad check fee for each bad check and requires them to use a supervisor-designated database to verify borrowers do not have outstanding deferred presentment transactions over $500, with data reported for public release. Imposes a cap on fees and loan amounts and limits renewals to two consecutive transactions, with disclosures required before entering into an agreement.

Who It Affects

• Borrowers who use deferred presentment services would be able to repay over six months, face new disclosure requirements, and be subject to new database checks and possible fees.
• Licensees (deferred presentment providers) would need to implement the database, report data to the supervisor, comply with fee caps and renewal limits, and adjust terms for repayment.

Key Provisions

• Repayment period for deferred presentment transactions extended to six months.
• Extensions beyond the term are prohibited; if an extended repayment option is used, it is limited to three monthly installments.
• Licensees may charge a bad check fee for each bad check presented.
• Licensees must use a supervisor-designated database to verify that a borrower has no outstanding deferred presentment transactions over $500, with a possible $1 per transaction data fee.
• Licensees must report specified information to the supervisor; the supervisor will publish aggregated data to the public.
• Maximum fee cannot exceed 17.5% of the amount advanced and the maximum amount advanced is $500; renewals are limited to two consecutive transactions.
• Written agreements with clear disclosures about fees and terms are required before entering into a deferred presentment transaction.

AI-generated summary using openai/gpt-5-nano on Feb 25, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Deferred Presentment Services