Bill Text: NY A09603 | 2015-2016 | General Assembly | Introduced

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Bill Title: 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.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced - Dead) 2016-03-21 - referred to banks [A09603 Detail]

Download: New_York-2015-A09603-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________
                                          9603
                   IN ASSEMBLY
                                     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:
     1    Section 1. The banking law is amended by adding a new section 202-k to
     2  read as follows:
     3    §  202-k.  Prohibition  of payday loans.  1. No foreign banking corpo-
     4  ration shall make any payday loan, either  directly  or  indirectly,  or
     5  make  any  loan  to  any other lender for purposes of financing a payday
     6  loan or refinancing or extending any payday loan.
     7    2. For purposes of this section "payday loan" means any transaction in
     8  which a short-term cash advance is made to a consumer  in  exchange  for
     9  (i)  a  consumer's  personal  check  or share draft, in the amount of an
    10  advance plus a fee, where presentment or negotiation of  such  check  or
    11  share  draft  is deferred by agreement of the parties until a designated
    12  future date; or (ii) a consumer's authorization to debit the  consumer's
    13  transaction account, in the amount of the advance plus a fee, where such
    14  account will be debited on or after a designated future date.
    15    §  2.  The  general obligations law is amended by adding a new section
    16  5-532 to read as follows:
    17    § 5-532. Prohibition on payday loans.  1. A creditor may  not  make  a
    18  payday  loan to any person if the creditor knows or has reasonable cause
    19  to believe that:
    20    a. the personal check or share draft the creditor  receives  from  the
    21  person,  in  exchange  for  the  loan, is drawn on an insured depository
    22  institution or insured credit union; or
    23    b. the account the creditor receives permission  from  the  person  to
    24  debit, in exchange for the loan, is a transaction account or share draft
    25  account at an insured depository institution or an insured credit union.
    26    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