SB91 Alabama 2016 Session

Updated Feb 27, 2026

Notable

Summary

Primary Sponsor: Arthur OrrSenator
Republican
Session: Regular Session 2016
Title: Payday loans, deferred presentment services, expand licensure requirements, further regulate deferred presentment services, penalties for evading licensure requirements, Secs. 5-18A-3, 5-18A-6, 5-18A-12, 5-18A-13 am'd.
Summary: SB91 would broaden and tighten Alabama's regulation of deferred presentment services (payday loans), raise licensing fees, and create penalties for evading licensure.
What This Bill Does
It expands the licensure requirement to cover deferred presentment services offered by mail, phone, Internet, mobile apps, or in-person, with a separate license for each location. It increases nonrefundable license fees ($500 per location to the department and $500 per location to the General Fund) plus a $100 application investigation fee, with potential fee increases by regulation. It tightens rules on loan fees, interest, number of loans, term, finance charges, and repayment, and establishes criminal penalties for evading licensure. It also sets specific loan terms (max $500, max 45% APR, origination and maintenance fees), requires disclosures and third-party database checks, allows limited renewals, and specifies an effective date for the act.

Who It Affects
Deferred presentment service providers and payday lenders: must obtain expanded licenses for all channels and locations, pay higher fees, and follow tighter loan terms and disclosure requirements.
Consumers who use deferred presentment services: will see clearer fee disclosures, a hard cap on loan amounts and terms, and stronger protections around repayment options and loan renewals.

Key Provisions
Expands licensure to include services offered by mail, telephone, Internet, mobile device applications, or in person; per-location licensing.
Increases license fees to $500 per location payable to the department and $500 per location payable to the General Fund, plus a $100 application investigation fee; supervisor may regulate fee amounts.
Makes it a criminal offense to evade licensure requirements and establishes corresponding penalties.
Regulates loan terms: maximum amount of $500, maximum finance charges (up to 45% APR), origination fee structure (up to 20% of first $300 plus 7.5% of any amount over $300), monthly maintenance fees (up to $7.50 per $100 with a $30 cap), minimum six-month term, and required prepayment refunds.
Allows up to two renewals with the same customer; restricts refinances and requires prorated refunds if renewed before maturity; requires written disclosures and use of third-party databases to verify outstanding balances.
Requires clear disclosures of all fees and terms to customers; prohibits deceptive practices; requires licensees to display a fee schedule and follow other consumer protections.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.
Subjects: Banks and Banking