An Initiative Measure
Payday Loan Reform Act
Text of Proposed Amendment
BE IT ENACTED BY THE
PEOPLE OF THE STATE OF ARIZONA:
Section 1. Title
This measure shall be
known as the Payday Loan Reform Act.
Section 2. Purpose
The people of Arizona declare that
the intent and purpose of this Act is to:
1. Reduce the cost of
small dollar, short-term consumer loans;
2. Promote responsible
consumer lending practices;
3. Provide consumers
with borrowing options on fair terms that allow a reasonable time to repay a
4. Regulate the
covered products in a comprehensive and efficient manner;
5. Make clear that
internet lenders are subject to the laws of this State; and,
6. Reduce the number
of store-front locations in our neighborhoods.
Section 3. 6-1251,
Arizona Revised Statutes is amended to read:
In this chapter,
unless the context otherwise requires:
office" means any office operated by a licensee to provide deferred
means a draft signed by the maker and made payable to a person that is
licensed pursuant to this chapter with the name of the maker preprinted on
the face of the check OR AN ELECTRONIC DEBIT AGREEMENT THAT COMPLIES WITH
TITLE 44, CHAPTER 26.
presentment services" means a transaction pursuant to a written
agreement in which the licensee accepts a check and agrees to hold the check
for at least five days before presentment for payment or deposit.
4. "Engaged in
the business" means either:
(a) Advertising to or
any other solicitation of a resident of this state that offers deferred
presentment services and that occurs within this state.
(b) Providing three or
more deferred presentment services within a calendar year to residents of this
means a license issued pursuant to this chapter.
"Licensee" means a corporation, company, firm, partnership,
association or natural person that is licensed by the superintendent to
engage in the business of providing deferred presentment services pursuant to
"Location" means the entire space in which a licensee provides
deferred presentment services.
means a person who either:
(a) Is authorized by
law or a partnership agreement to participate in the management of the
business of the partnership.
(b) Owns more than
twenty-five per cent of the applicant or licensee partnership.
Section 4. 6-1254,
Arizona Revised Statutes, is amended to read:
A. An applicant for a
1. Shall be a citizen
of the United States.
2. Shall be a person
of honesty, truthfulness and good moral character.
3. Shall not have been
convicted of a crime that involves moral turpitude.
4. Shall not have
defaulted on payment of money collected or received for another person.
5. Shall not have been
a former licensee pursuant to this chapter whose license was suspended or
revoked and not subsequently reinstated.
B. If the applicant is
a person other than a natural person, the qualifications required by
subsection A are also required of any executive
officer, director or partner of the firm, partnership or association.
C. To qualify for a
license an applicant shall have AND MAINTAIN:
1. A minimum net worth
in cash or cash equivalents, determined in accordance with generally accepted
accounting principles, of at least fifty thousand dollars, PER LICENSED
LOCATION, UP TO A MAXIMUM REQUIRED NET WORTH OF ONE MILLION DOLLARS.
2. The financial
responsibility, character and experience to warrant a belief that the
business is operated lawfully, honestly, fairly and efficiently.
Section 5. 6-1259,
Arizona Revised Statutes is amended to read:
A. A person shall not
engage in the business of providing deferred presentment services, including
internet deferred presentment services, without first obtaining a license
pursuant to this chapter. A separate license is required for each location
from which the business is conducted. The licensee shall post its license to
engage in the business of deferred presentment services at each location that
is licensed pursuant to this chapter.
B. A licensee shall
1. Advance monies on
the security of a check without first obtaining reasonable evidence that
indicates that the account on which the presented check is drawn is an open
and active account.
2. Assess any fee that
is more than the amount prescribed in this chapter.
3. At the licensed
location engage in the business of:
(a) Making loans of
money or extensions of credit other than those allowed under this
TITLE or title 44, chapter 11, article 3.
(b) Discounting notes,
bills of exchange, items or other evidences of debt.
(c) Accepting deposits
or bailments of money or items, except as expressly
provided in section 6-1260.
4. Use or cause to be
published or disseminated any advertisement that contains false, misleading
or deceptive statements or representations.
5. Engage in the
business of deferred presentment services at locations other than licensed
6. Engage in unfair,
deceptive or fraudulent practices.
7. Alter or delete the
date on a check accepted by the licensee.
8. Take possession of
an undated check or a check dated on a date other than the date on which the
licensee takes possession of the check or the date of presentment.
9. Require a customer
to provide security for the transaction, other than the presented check, or
require the customer to provide a guaranty from another person.
10. Fail to take
reasonable measures to ensure that no customer has more than one deferred presentment
loan outstanding at any time with any licensee in this state.
11. Engage in the sale
of the following goods or services at any licensed location:
(a) Gaming activities,
including the sale of lottery tickets.
12. Tie or otherwise
condition the offering of deferred presentment services to the sale of any
good or service.
13. Permit others to
engage in any activity prohibited in this section at a location licensed
pursuant to this chapter.
14. Offer deferred
presentment services for less than five days OR LONGER THAN THIRTY FIVE DAYS.
15. Be required to
request or accept any written representation by a customer as to whether the
customer has any outstanding checks for deferred presentment held by other
15. Charge a
16. ENTER INTO A NEW
DEFERRED PRESENTMENT TRANSACTION WITH A CUSTOMER UNTIL THE NEXT BUSINESS DAY
FOLLOWING THE COMPLETION OF A PRIOR TRANSACTION, INCLUDING A REPAYMENT PLAN
Sec. 6. Section
6-1260, Arizona Revised Statutes, is amended to read:
presentment; amount; fees; loans to members of military service; repayment
A. The licensee may
accept for deferred presentment or deposit a check with a face amount of at
least fifty dollars but not more than five hundred dollars, excluding the
fees permitted in subsection
F G of this section.
B. For each check the
licensee accepts for deferred presentment
or deposit, the licensee and
the customer shall sign a written agreement IN ENGLISH OR IN SPANISH AT THE
CUSTOMER'S REQUEST that contains the name or trade name of the licensee, the
transaction date, the amount of the check, the amount to be paid by the
maker, a statement of the total amount of the fees charged, expressed both as
a dollar amount and as an effective annual percentage rate, a disclosure
statement that complies with state and federal truth in lending laws and a
notice to the customer as prescribed in subsection C of this section. The
written agreement shall expressly require the licensee to defer presentment
or deposit of the check until a specified date. THE WRITTEN AGREEMENT SHALL
CONTAIN THE FOLLOWING INFORMATION ADJACENT TO THE CUSTOMER SIGNATURE LINE:
1. THE TELEPHONE
NUMBER AND ADDRESS OF THE DEPARTMENT.
2. THE LICENSEE IS
REGULATED BY THE DEPARTMENT.
3. ANY COMPLAINTS
CONCERNING THE AGREEMENT MAY BE ADDRESSED TO THE DEPARTMENT AT THE
DEPARTMENT'S ADDRESS AND TELEPHONE NUMBER.
C. A licensee shall
provide a notice in a prominent place on each written agreement that
specifies that no customer may have outstanding more than one deferred
presentment service agreement at one time and the face amount, exclusive of
any fees, cannot be more than five hundred dollars. A licensee shall ask
every customer who seeks deferred presentment services whether that customer
has any outstanding checks payable to other licensees.
D. A licensee may rely
on the customer's representation of whether the customer has any outstanding
checks for deferred presentment held by other licensees.
E. UNTIL A DATABASE IS
CERTIFIED BY THE DEPARTMENT PURSUANT TO SECTION 6-1264, A LICENSEE MAY RELY
UPON THE CUSTOMER'S WRITTEN REPRESENTATION THAT THE CUSTOMER DOES NOT HAVE AN
OUTSTANDING, INCOMPLETE REPAYMENT PLAN AS DESCRIBED IN SUBSECTION O OF THIS
E. F. The maker of a
check has the right to redeem the check from the licensee before the agreed
on date of presentment or deposit if the maker pays the licensee the amount
of the check.
F. G. A licensee shall
not directly or indirectly charge any fee or other consideration for accepting
a check for deferred presentment or deposit that is more than fifteen per
cent of the face amount of the check for any initial transaction or any
extension PRINCIPAL AMOUNT BORROWED BY THE CUSTOMER.
G. H. A licensee may
impose the fee prescribed in subsection F G of this section only once
for each written agreement. The fee is earned on execution of the written
agreement and is not subject to any reimbursement even if the maker redeems
the check pursuant to subsection E F of this section.
H. I. The fee charged by
the licensee is not interest for purposes of any other law or rule of this
I. J. Except as
otherwise provided in this subsection, A person may NOT, FOR A FEE,
extend the presentment or deposit of a check. not
more than three consecutive times. For each extension the customer and the
licensee shall terminate the previous agreement and sign a separate
agreement. During an incomplete transaction the customer may not receive
any additional monies from the licensee. The licensee may charge a fee as
prescribed in subsection F of this section for each extension. A person who
is a member of the military service of the United States or the member's
spouse may not extend the presentment or deposit of a check. If a
customer has completed a deferred presentment transaction with the licensee,
the customer may enter into a new agreement for deferred presentment services
with the licensee ON THE NEXT BUSINESS DAY FOLLOWING THE COMPLETION OF AN
EXISTING TRANSACTION, INCLUDING THE COMPLETION OF A REPAYMENT AGREEMENT AS
PROVIDED FOR IN SECTION 6-1260.O. A transaction is completed when the
customer's check is presented for payment, deposited or redeemed by the
customer for cash.
J. K. If a check is
returned to the licensee from a payer financial institution due to
insufficient funds, a closed account or a stop payment order, the licensee
may use all available civil remedies to collect on the check including the
imposition of the dishonored check service fee prescribed in section 44-6852.
THE LICENSEE SHALL NOT CHARGE A DISHONORED CHECK SERVICE FEE MORE THAN TWICE
FOR A CHECK RETURNED DUE TO INSUFFICIENT FUNDS. THE LICENSEE SHALL NOT CHARGE
A DISHONORED CHECK SERVICE FEE MORE THAN ONCE FOR A CHECK RETURNED DUE TO A
CLOSED ACCOUNT OR A STOP PAYMENT ORDER. A LICENSEE MAY NOT CHARGE ANY
ADDITIONAL FEES FOR THE DEFERRED PRESENTMENT TRANSACTION IF A CHECK IS
RETURNED TO THE LICENSEE FROM A PAYER FINANCIAL INSTITUTION DUE TO
INSUFFICIENT FUNDS, A CLOSED ACCOUNT OR A STOP PAYMENT ORDER, EXCEPT AS
PROVIDED IN THIS SUBSECTION. An individual who issues a personal check to a
licensee under a deferred presentment agreement is not subject to criminal
prosecution pursuant to title 13, chapter 18.
K L. Before engaging in
a deferred presentment transaction, a licensee shall provide to a customer
who is a member of the military service of the United States or the member's
spouse a written statement that clearly and conspicuously states the
prohibited practices and requirements prescribed in subsection L M of
L. M. If lending to a
member of the military service of the United
States or the spouse of a member of the military
service of the United
States, a licensee:
1. Shall not garnish
any military wages or salary.
2. Shall not conduct
any collection activity against a customer who is a member of the military
service of the United States or the spouse of the member during the member's
deployment to a combat or combat support posting or during active duty
service by a member of the national guard or any military reserve unit of any
branch of the armed forces of the United States.
3. Shall contact the
employer of a member of the military service of the United States
about a deferred presentment debt of the member or the member's spouse. The
contact allowed by this paragraph shall only be a notice for informational
purposes and shall not be an attempt to collect on a loan made to the member
or the member's spouse. A licensee shall not attempt to collect on a loan
made to a member of the military service of the United States or the member's
spouse through the member's chain of command.
4. Shall not conduct a
deferred presentment transaction with a member of the military service of the
or the member's spouse in any location that the member's commanding officer
prohibits the member or the member's spouse from transacting deferred
5. Is bound by the
terms of any repayment agreement that the licensee negotiates with respect to
the customer through military counselors or third party credit counselors.
N. A LICENSEE WHO
ENTERS INTO A DEFERRED PRESENTMENT TRANSACTION WITH A "COVERED
BORROWER" AS THAT TERM IS DEFINED IN SECTION 670 OF THE JOHN WARNER
NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2007 (P.L. 109-364; 120
STAT. 2083; 10 UNITED STATES CODE SECTION 987), AND REGULATIONS PROMULGATED
THEREUNDER, AND WHO VIOLATES ANY PROVISION OF SUCH ACT OR REGULATION IN
EFFECT ON THE EFFECTIVE DATE OF THIS AMENDMENT TO THIS SECTION IS IN
VIOLATION OF THIS TITLE.
O. IF A CUSTOMER
REQUESTS A REPAYMENT PLAN AND SIGNS AN AMENDMENT TO THE PARTIES' WRITTEN
AGREEMENT BEFORE THE CLOSE OF BUSINESS ON THE DATE ON WHICH A DEFERRED
PRESENTMENT TRANSACTION IS DUE, THE LICENSEE SHALL ENTER INTO A REPAYMENT
PLAN WITH THE CUSTOMER AS FOLLOWS:
1. THE REPAYMENT PLAN
SHALL DIVIDE THE CUSTOMER'S OUTSTANDING BALANCE INTO FOUR SUBSTANTIALLY EQUAL
PAYMENTS THAT COINCIDE WITH THE CUSTOMER'S EXPECTED PAY DAYS OR IF THE
CUSTOMER IS UNEMPLOYED AT THE TIME, FOUR MONTHLY PAYMENTS. NO ADDITIONAL FEES
OR INTEREST MAY BE ASSESSED ON THE OUTSTANDING BALANCE PAID PURSUANT TO THE
REPAYMENT PLAN IF THE CUSTOMER FULFILLS THE TERMS OF THE REPAYMENT PLAN. A
REPAYMENT PLAN IS NOT AN AGREEMENT FOR DEFERRED PRESENTMENT SERVICES AND IS
NOT A LOAN. EXCEPT FOR THE REVISED PAYMENT SCHEDULE THE TERMS OF THE DEFERRED
PRESENTMENT AGREEMENT REMAIN IN FULL FORCE AND EFFECT. PROVIDED THAT THE
CUSTOMER HAS COMPLIED WITH THE TERMS OF THE REPAYMENT PLAN, THEN DURING THE
TERM OF THE REPAYMENT PLAN THE LICENSEE MAY NOT SEEK TO COLLECT ANY AMOUNT
DUE EXCEPT PURSUANT TO THE TERMS OF THE REPAYMENT PLAN. IF THE CUSTOMER MAKES
EACH OF THE PAYMENTS REQUIRED UNDER THE REPAYMENT PLAN, THE OUTSTANDING
DEFERRED PRESENTMENT SERVICES AGREEMENT SHALL BE COMPLETED. IF THE CUSTOMER
FAILS TO ADHERE TO THE ORIGINAL REPAYMENT PLAN, THE LICENSEE MAY ENGAGE IN
ANY LAWFUL COLLECTION ACTIVITY, BUT SHALL USE REASONABLE EFFORTS TO NEGOTIATE
A MUTUALLY AGREEABLE ALTERNATIVE REPAYMENT PLAN BEFORE INITIATING ANY LEGAL
2. NO LICENSEE MAY
ALLOW A CUSTOMER TO ENTER INTO THE AGREEMENT PROVIDED FOR IN THIS SUBSECTION
MORE THAN ONCE PER THREE HUNDRED AND SIXTY-FIVE DAY PERIOD COMMENCING ON THE
FIRST DAY OF THE AGREEMENT.
3. THE LICENSEE SHALL
SUBMIT TO A CONSUMER CREDIT REPORTING SERVICE THE DATA REQUIRED BY SECTION
6-1264 AT THE TIME IT ENTERS INTO A REPAYMENT PLAN.
4. AT THE SUCCESSFUL
COMPLETION OF THE REPAYMENT PLAN, THE LICENSEE SHALL REPORT TO THE CONSUMER
CREDIT REPORTING SERVICE THAT THE CUSTOMER'S REPAYMENT PLAN IS TERMINATED.
Sec. 7. Section
6-1262, Arizona Revised Statutes, is amended to read:
classification; individual liability
A. A person that
provides deferred presentment services without a license is guilty of a class
B. A licensee that
violates this chapter or the rules adopted pursuant to this chapter is
subject to revocation of the licensee's license and is guilty of a class 1
C. An officer or agent
of a corporation or association who participates in a violation of this
chapter is subject to the penalties prescribed in this section.
D. Except as the
result of an accidental or bona fide error, if the licensee charges,
contracts for or receives any amount in excess of the fees expressly
permitted by this chapter, the deferred presentment is voidable and the
licensee has no right to collect or receive any fees in connection with the
deferred presentment transaction. Any deferred presentment transaction, that
is made by a person who is required to be licensed pursuant to this chapter
but who is not licensed is void, and the person has no right to MAINTAIN A
COURT ACTION OR OTHERWISE collect, receive or retain any principal or other
fees in connection with that deferred presentment transaction. ANY AMOUNT
RECEIVED BY A CUSTOMER FROM A PERSON WHO IS REQUIRED TO BE LICENSED BUT WHO
IS NOT, SHALL BE DEEMED A GIFT TO THE CUSTOMER.
Sec. 8. Repeal
Arizona Revised Statutes is hereby repealed.
Sec. 9. Title 6,
chapter 12.1, article 1, Arizona Revised Statutes, is amended by adding a new
section 6-1264, to read:
reasonable methods for verification; one incomplete repayment plan;
A. BEFORE ENTERING
INTO A DEFERRED PRESENTMENT AGREEMENT WITH A CONSUMER, A LICENSEE MUST USE A
COMMERCIALLY REASONABLE METHOD OF VERIFICATION TO VERIFY THAT THE CUSTOMER
HAS NO OUTSTANDING INCOMPLETE REPAYMENT PLANS AS PROVIDED FOR IN SECTION
6-1260.O WITH THE LICENSEE OR ANY OTHER LICENSEE.
B. NO LATER THAN
OCTOBER 15, 2009, THE SUPERINTENDENT SHALL CERTIFY THAT ONE OR MORE CONSUMER
REPORTING SERVICE DATABASES ARE COMMERCIALLY REASONABLE METHODS OF
VERIFICATION. THE LIST OF PROVIDERS THAT THE DIRECTOR HAS CERTIFIED AS
PROVIDING COMMERCIALLY REASONABLE METHODS OF VERIFICATION SHALL BE POSTED ON
THE DEPARTMENT'S WEBSITE AND SHALL BE MAILED TO EACH LICENSEE BY FIRST CLASS
MAIL AT THE ADDRESS OF RECORD
AS SHOWN ON THE DEPARTMENT'S
C. EACH LICENSEE WHO
PROVIDES DEFERRED PRESENTMENT SERVICES SHALL COMPLY WITH SUBSECTION A OF THIS
SECTION NO LATER THAN DECEMBER 31, 2009.
D. A CONSUMER SEEKING
DEFERRED PRESENTMENT SERVICES MAY MAKE A DIRECT INQUIRY TO THE CONSUMER
REPORTING SERVICE TO REQUEST A MORE DETAILED EXPLANATION OF THE BASIS FOR A
CONSUMER REPORTING SERVICE'S DETERMINATION THAT THE CONSUMER IS INELIGIBLE
FOR A DEFERRED PRESENTMENT, AND THE CONSUMER REPORTING SERVICE SHALL PROVIDE
A REASONABLE RESPONSE TO THE CONSUMER.
E. IN CERTIFYING A
COMMERCIALLY REASONABLE METHOD OF VERIFICATION, THE SUPERINTENDENT SHALL
ENSURE THE CERTIFIED DATABASE:
1. PROVIDES REAL TIME
ACCESS THROUGH AN INTERNET CONNECTION OR, IF REAL TIME ACCESS THROUGH AN
INTERNET CONNECTION BECOMES UNAVAILABLE DUE TO TECHNICAL PROBLEMS INCURRED BY
THE CONSUMER REPORTING SERVICE, THROUGH ALTERNATIVE REAL TIME VERIFICATION
MECHANISMS, INCLUDING REAL TIME VERIFICATION BY TELEPHONE;
2. CONTAINS A REAL
TIME REGULATOR INTERFACE THAT ALLOWS THE DEPRTMENT TO ACCESS A CONSUMER
REPORTING SERVICE DATABASE FOR REQUIRED MONITORING AND REPORTING FUNCTION;
THIS INCLUDES THE ABILITY TO DETERMINE CONSUMER ELIGIBILITY AND REPORTS FOR
LICENSEE EXAMINATIONS, REGULATORY REPORTING AND PROGRAM MONITORING;
3. PROVIDES LICENSEES
WITH A STATEMENT THAT A CONSUMER IS ELIGIBLE OR INELIGIBLE FOR DEFERRED
PRESENTMENT SERVICES AND A DESCRIPTION OF THE REASON FOR THE DETERMINATION.
4. PROVIDES ADEQUATE SAFEGUARDS
TO ENSURE THAT CONSUMER INFORMATION CONTAINED IN THE CONSUMER REPORTING
DATABASE IS KEPT CONFIDENTIAL;
5. DOES NOT ALLOW THE
LICENSEE TO ENTER INTO A DEFERRED PRESENTMENT AGREEMENT THAT WOULD BE IN
VIOLATION OF THIS CHAPTER;
6. ENSURES THAT INFORMATION
SUBMITTED TO THE CERTIFIED DATABASE IS CONFIDENTIAL AND SHALL NOT BE
RELEASED, OR OTHERWISE MADE AVAILABLE, TO THE PUBLIC;
7. DEMONSTRATES A
WORKING SYSTEM TO THE DEPARTMENT PRIOR TO THE CERTIFICATION; AND
8. REQUIRES THAT A
PROVIDER BE A REGISTERED CONSUMER REPORTING AGENCY AND BE SUBJECT TO THE
APPLICABLE RULES AND REGULATIONS APPLIED BY THE FEDERAL TRADE COMMISSION
UNDER THE FAIR CREDIT REPORTING ACT.
F. A LICENSEE SHALL
UPDATE THE CERTIFIED DATABASE WHEN:
1. A CONSUMER ELECTS
TO ENTER INTO A REPAYMENT PLAN;
2. A CONSUMER'S
REPAYMENT PLAN IS PAID IN FULL; OR
4. A LICENSEE
DETERMINES A REPAYMENT PLAN IS IN DEFAULT.
G. A LICENSEE MAY RELY
ON THE INFORMATION CONTAINED IN THE CERTIFIED DATABASE AS ACCURATE AND IS NOT
SUBJECT TO ANY PENALTY OR LIABILITY AS A RESULT OF RELYING ON INACCURATE
INFORMATION CONTAINED IN THE DATABASE.
H. IN DETERMINING
WHETHER A CREDIT REPORTING SERVICE SHOULD BE CERTIFIED AS A COMMERCIALLY
REASONABLE METHOD OF VERIFICATION, THE SUPERINTENDENT WILL CONSIDER WHETHER
SUCH CREDIT REPORTING SERVICE IS ADEQUATELY CAPITALIZED, DEMONSTRATES THE
RESOURCES AND ABILITY TO PERFORM THE SERVICES REQUIRED PURSUANT TO THIS
SECTION, AND HAS APPROPRIATE SURETY TO ENSURE PERFORMANCE OF ITS OBLIGATIONS
PURSUANT TO THIS SECTION AND TO REASONABLY PROTECT CLAIMANTS IN THE EVENT
THAT ACTIONS OR INACTIONS ON THE PART OF THE CREDIT REPORTING SERVICE RESULTS
IN DAMAGES TO LICENSEES OR CONSUMERS.
Sec. 10. Section
12-671, Arizona Revised Statutes, is amended to read:
check or draft on no account or insufficient account with intent to defraud;
civil action; definition of credit; prima facie evidence
A. A person who, for
himself or for another, with intent to defraud, makes, draws, utters or
delivers to another person or persons a check or draft on a bank or
depositary for payment of money, knowing at the time of such making, drawing,
uttering or delivery, that he or his principal does not have an account or
does not have sufficient funds in, or credit with, such bank or depositary to
meet the check or draft in full upon presentation, shall be liable to the
holder of such check or draft for twice the amount of such check or draft or
fifty dollars, whichever is greater, together with costs and reasonable
ATTORNEY fees as allowed by the court on the basis of time and effort
expended by such attorney on behalf of plaintiff, EXCEPT THAT LIABILITY FOR A
CHECK OR DRAFT PRESENTED ACCORDING TO TITLE 6, CHAPTER 12.1 IS LIMITED TO
ONLY THE FACE VALUE OF THE CHECK OR DRAFT TOGETHER WITH COSTS AND REASONABLE
ATTORNEY FEES AND ANY APPLICABLE DISHONORED CHECK SERVICE FEE PRESCRIBED IN
B. The word
"credit" as used in this section shall be construed to be an
express agreement with the bank or depositary for payment of the check or
C. Proof that, at the
time of presentment, the maker, issuer or drawer did not have sufficient
funds with the bank or depositary, and that he failed within twelve days
after receiving notice of nonpayment or dishonor to pay the check or draft is
prima facie evidence of intent to defraud.
D. Where a check,
draft or order is protested, on the ground of insufficiency of funds or
credit, the notice of formal protest thereof shall be admissible as proof of
presentation, nonpayment and protest and shall be prima facie evidence of the
insufficiency of funds or credit with the bank or depositary, or person, or
firm or corporation.
as used in this section, means notice given to the person entitled thereto,
either in person, or in writing. Such notice in writing shall be given by
certified mail, return receipt requested, to the person at his address as it
appears on such check or draft.
F. Nothing in this
section shall be applicable to any criminal case or affect eligibility or
terms of probation.
Sec. 11. Section
44-6852, Arizona Revised Statutes, is amended to read:
checks; service fee
other law EXCEPT AS PROVIDED IN SECTION 6-1260, the holder, payee or assignee
of the holder or payee of a dishonored check, draft, order or note may charge
and collect from the maker or drawer a service fee of not more than
twenty-five dollars plus any actual charges assessed by the financial
institution of the holder, payee or assignee of the holder or payee as a
result of the dishonored instrument.
Sec. 12. Conflicting
constitutes a comprehensive regulatory program for deferred presentment
lending. The people intend that if this measure receives more votes than any
other initiative concerning deferred presentments then this measure shall
prevail and take effect in its entirety and that no provision of any other
measure concerning deferred presentments shall take effect in any respect.
Sec. 13. Severability
If any provision of
this initiative measure is declared invalid, such invalidity shall not affect
other provisions of this initiative measure which can be given effect without
the invalid provision. To this end, the provisions of this initiative measure
are declared to be severable.
Analysis by Legislative Council
Currently, state law
regulates companies that provide deferred presentment services. Deferred
presentment is a service where a company makes a loan to a customer, accepts
the customer's check in return and agrees to hold the check for at least five
days before presenting the check for payment or deposit. These services are
more commonly known as "payday loans".
presentment licensing program in the current law is set to terminate on July
1, 2010. Proposition 200 would continue to allow deferred presentment
services indefinitely because it would repeal the program's termination date.
A company or
individual providing deferred presentment services is licensed by this state
to provide those services and is referred to as a "licensee".
Proposition 200 would expand the scope of deferred presentment services to
include electronic debit agreements and would further make the following
changes to the regulation of companies that provide deferred presentment
1. A licensee would
a. Prohibited from
offering deferred presentment services for longer than 35 days.
b. Prohibited from
entering into a new deferred presentment transaction with a customer until
the next business day following the completion of any prior transaction.
c. Required to provide
the deferred presentment agreement in English or Spanish, as requested by the
customer. The agreement must contain contact information for the state agency
that regulates licensees.
d. Prohibited from
charging a fee to extend the presentment or deposit of a check, but would not
be limited on the number of times the presentment or deposit could be
e. Prohibited from
charging a dishonored check fee more than:
i. Twice for a check
returned due to insufficient funds.
ii. Once for a check
returned due to a closed account or a stop payment order.
f. Required to enter
into a repayment plan with the customer if the customer requests it before
the deferred presentment transaction is due. The repayment plan would divide
the customer's remaining balance into four substantially equal payments. A
licensee would not be able to assess additional fees or interest on the
outstanding balance or seek to collect any amount due except pursuant to the
terms of the repayment plan so long as the customer fulfills his repayment
plan obligation; otherwise, the customer could be taken to collections. A
customer's obligation under the deferred presentment services agreement would
be fulfilled if the repayment plan is completed. A customer would only be
allowed to enter into a repayment plan once every 365 days. A customer's
participation in and completion of a repayment plan would be reported to a
consumer credit reporting service (an entity that assembles or evaluates
consumer credit information for the purpose of providing consumer credit
reports to third parties).
g. Prohibited from
entering into a deferred presentment arrangement with a customer who has an
outstanding, incomplete repayment plan. Before October 15, 2009, Proposition
200 would allow a licensee to rely on a customer's written representation
that the customer does not have an outstanding, incomplete repayment plan.
The superintendent of the state agency that regulates licensees would be
required, by October 15, 2009, to identify consumer credit reporting services
that meet certain criteria and can be used by companies to verify whether a
consumer has an outstanding, incomplete repayment plan and is eligible or
ineligible for deferred presentment services.
2. A licensee would
not be prohibited from making certain other loans of money or extension of
credit such as consumer revolving loans and home equity revolving loans.
3. An applicant for a
license would be required to maintain a minimum net worth in cash or cash
equivalents of at least $50,000 per licensed location, up to a maximum
required net worth of $1,000,000.
4. A licensee would be
civilly liable under state law for violating a federal law that provides
consumer credit protections for active members of the military and their
families ("covered borrowers").
State law requires the
Joint Legislative Budget Committee (JLBC) Staff to prepare a summary of the
fiscal impact of certain ballot measures. By continuing to regulate payday
lenders, Proposition 200 would allow the state to continue to collect
$360,000 in fees from payday lenders that are deposited into the General
Fund. These monies would otherwise stop being collected on July 1, 2010. The
proposition would also require the state to continue to expend funding to oversee
payday lenders, which would otherwise end in 2010. Currently, the Department
of Financial Institutions spends $60,000 annually to regulate the industry.
The proposition may cause the Department of Financial Institutions' workload
to oversee payday lenders to increase.
"For" Proposition 200
Prop 200: The Payday Loan Reform Act
A payday loan is a
small, unsecured, cash advance that is usually repaid on the borrower's next
payday. Everyday in Arizona,
thousands of hardworking people use a payday loan to meet unexpected
financial challenges while avoiding expensive bounced-check fees, overdraft
fees, late bill payment penalties, and other less desirable short-term credit
The time has come to
implement reforms in the industry to further protect consumers, improve the
way companies do business in Arizona,
and preserve this financial option for those customers who choose it.
Prop 200 contains a number of important industry reforms:
1. Creates tough new penalties for unregulated, off-shore internet lenders
2. Requires all AZ payday loan stores to significantly reduce loan fees
3. Prohibits costly loan extensions
4. Mandates a no-cost repayment plan for those customers who cannot meet
5. Preserves this financial option for those Arizonans who choose it
These reforms and
others in the Proposition will also have the effect of reducing the number of
payday loan stores in AZ.
Please vote Yes.
Manny Tarango, Treasurer, Arizonans for Financial Reform, Phoenix
Paid for by
"Arizonans for Financial Reform"
Reform Good For Customers
I live in Tucson and work for a
payday loan company. Everyday I see hard-working people come into my store
with money worries and leave with cash in their hands and relief on their
faces. I see this a lot with single moms who are
trying to deal with covering bills between paychecks.
They come into our
store and we give them the temporary help they need.
I also see some of our
customers having trouble with keeping their financial affairs in order as
they come in to explain that they cannot payback their loan obligation.
Today, these customers
spend extra on fees to extend their loan, or sometimes go to another
competing payday loan store and get a second loan to pay off the first loan.
It's not good money management, but it's easy for people to do.
The Payday Loan Reform
Act will stop this. It prohibits
extra-fee loan extensions and makes it more difficult for customers to have
more than one loan at a time.
It also gives my
customers the choice of a repayment plan that costs them nothing additional
should they find themselves unable to pay their loan back when due.
These reforms are in
the best interest of customers and will make payday loans a more consumer
friendly product for those people that find it hard to pay their debts on
This reform is a good thing for people. I hope voters support it.
Carl Hancox, Payday Loan Industry Employee, Tucson
I Believe in
Economic Freedom, Consumer Choice, and Tough But Fair Regulation
The Payday Loan Reform
Act makes sense to me. The payday lending industry in Arizona serves an important function as a
simple, convenient, and less costly place for people to borrow money when the
short-term need arises.
Reforming the industry
even while keeping this financial option available for those who choose it is
a sensible, reasonable thing to do in Arizona.
When I served as a
Member of the Arizona State Senate I put my faith in people to make their own
decisions about how to live their lives. When considering regulatory policy,
I believed in tough but fair regulation that protected consumers while still
giving free enterprise a positive environment in which to do business.
The Payday Loan Reform Act is true to these same ideals.
If you believe like I
do that people know best what personal decisions to make in their own
financial lives then please join me in supporting this Proposition.
If you believe like I
do that the payday loan industry ought to be regulated in a tough but fair
manner then vote Yes with me.
If you believe like I
do that consumers deserve choices in the financial marketplace and that
removing those choices is not good policy for Arizona then support the Payday Loan
Stan Barnes, Former Arizona
State Senator, Mesa
Place For Payday Lending in Arizona
I remember what it was
like when I was single and living paycheck-to-paycheck. It's not fun, and
anyone who has been there knows what I'm talking about.
Now I have a great
family, a successful career, a nice home, and even a little money in the
bank, but some of my neighbors and friends do not. They're still in a
position where every now and then they face a cash crunch because something
like the transmission goes out on the car and without it they can't get to
It's good to have
options to get the money you need. Not everyone can call up their rich uncle
and borrow a few bucks, and it's almost impossible to walk into a local bank
branch and borrow $100 for 2 weeks.
I'm asking the voters of
think about folks that are making less than $40,000 a year and trying to pay
the rent, make the car payment, cover the grocery bill, and praying that a
financial emergency never comes.
I'm glad the Payday
Loan Reform Act is here to make the industry more consumer
friendly while still being available.
Ian Calkins, Phoenix
"Payday Loans" and See What You Get
I've watched the
Arizona Legislature fool around with the payday loan issue for a few years
while delivering no results. Too bad. There are changes needed in the
industry, and all certain legislators want to do is run out the clock because
they think they can eliminate the payday lending in Arizona. Anyone who thinks you can
eliminate payday loans in Arizona
should simply do a little internet search. "Payday Loan" gets
11,700,000 hits... and a great many of these are from potentially
unscrupulous companies located outside of the US.
If payday loans were
banned in Arizona,
the demand for short-term, unsecured loans would not magically vanish but
instead would go to other options including the unregulated internet lenders.
It's far better for Arizona payday lending
customers to have a regulated bricks-and-mortar industry to use instead of
unregulated, off-shore lenders via the internet.
Tom Adair, Mesa
I Want Fewer
Payday Loan Stores in Arizona
I support the Payday
Loan Reform Act because the payday loan industry ought to be well regulated
to protect Arizona
customers who choose to use payday loan services.
I also support the Proposition because it will lead to fewer payday
loan stores in Arizona cities and towns
including my hometown of Tucson.
The Payday Loan Reform
Act does two important things that will lower the number of payday loan
stores in Arizona.
it raises the minimum financial requirements needed to own and operate a
payday lending store in Arizona.
the reforms in the Act will significantly reduce the gross revenue to the
industry, which will certainly cause some stores to go out of business in Arizona.
Reforming the payday
loan industry in Arizona
to protect consumers is a good thing.
Please join me in
supporting this Proposition.
Jonathan Paton, Republican State
Credit Options in a Bad Economy
These are tough
economic times for many people.
The price of gas, the
high cost of food, and trouble in the housing market are all contributing to
a financial squeeze for Arizonans.
It's critical in times
like these that people have options when they need help. It's also critical
to ensure that consumers are protected.
That's why I'm
supporting the Payday Loan Reform Act.
Not everyone can walk into a bank and borrow money, and not everyone
has a credit card to use when unexpected bills arrive.
Access to credit is a key issue in a down economy.
Payday loans are an
important, short-term answer for many people in Arizona and it is essential that the
industry be reformed and allowed to remain in business to serve those
customers who need temporary help.
Please join me in
supporting the Payday Loan Reform Act.
Democratic State Representative, Phoenix
customers are average Arizonans
Opponents claim that the payday advance industry exploits the
By perpetuating this myth, they have created a warped idea of the
industry's customer base.
Actually, payday advance customers represent the heart of Arizona's middle
They are typical hard working adults who may not have savings or
disposable income to use as a safety net when unexpected expenses occur.
Here are the facts:
majority of payday advance customers earn between $25,000 and $50,000
percent are under 45 years old; only 4 percent are over 65, compared to 20
percent of the population;
percent have a high school diploma or better, with 56 percent having some
college or a degree;
percent own their own homes;
majority are married and 64 percent have children in the household; and,
hundred percent have steady incomes and active checking accounts, both of
which are required to receive a payday advance. *
Vote Yes on Prop 200
Sherry McComb, Goodyear
lending opponents wrongly claim "cycle of debt"
Although the phrase "cycle of debt" is a favorite
among opponents, it's not based on the truth.
Arizona currently limits
rollovers to three times. Prop 200 would make any rollover illegal.
Researchers and state regulators consistently report that 70-80
percent of customers use payday advances between once a year and about once a
People who bounce checks and use overdraft protection often do
so at a higher frequency.
The fact is that a payday advance is more economical than other
Peter Davies, Mesa
I use payday
loans and I support Prop 200
As a customer who
occasionally uses payday loan stores to help pay bills between paychecks, I'm
voting ‘yes' on this ballot measure.
I have a stable job,
but sometimes I've found that unexpected bills pop up (such as car repairs)
and I'm still a few days away from payday. It's not like I can go without my
car, so I occasionally need to use the short-term credit option.
Unfortunately, I can't
just walk into Bank of America or Wells Fargo and get a $300 short-term loan
from them. They don't offer it. Apparently banks used to offer short-term loans,
but stopped doing so years ago.
My only other option
is to ask my friends or family for cash. But frankly I'm a little embarrassed
to do that and I certainly don't need my father-in-law to know that things
lending stores exist so I can use this option. While I wish the service were
free, I recognize that everything has a cost to it.
My hope is that if
Prop 200 passes, it will improve this option for me when I use it.
Thanks for voting yes.
Mark Baker, Phoenix
Loans - Preserve Thousands of Jobs
I work in the payday
loan industry in Arizona
and because I am involved in the industry I have been paying close attention
to the debate that surrounds the issue.
Something that doesn't
get a lot of attention is the number of jobs that would be lost by industry
employees in Arizona
should opponents get their way and ban payday lending in our State.
approximately 2,500 people that work in the payday loan industry in Arizona. The industry
pays good wages, and employees also get good benefits including health
If payday loans were
made illegal in Arizona
all of these people, including myself, would be out of a job and facing the
tough task of finding new employment in a down economy.
The ‘Payday Loan Reform
Act' makes changes in our industry that benefit our customers in Arizona while making
it possible to continue to do business with the people we serve.
Please join me in
Matt McKnight, Queen
Voting Yes on
Prop 200 will lower fees on payday loans
One of the key reforms
in Prop 200 is a mandate that requires all AZ payday loan stores to
significantly reduce fees.
Specifically, the fee
on a two-week loan in AZ would be capped at $15 per $100 borrowed.
This reform will
significantly benefit consumers.
Studies have shown
that this cap is the bare minimum amount that lenders can charge and still
earn a reasonable profit after paying salaries, government taxes, etc.
A fee any lower than
that and stores will likely go out of business - Hurting consumers in the
A Yes vote on Prop 200
will lower the fee that consumers pay on short-term loans in AZ.
Vote Yes on Prop 200
to implement this important reform.
Tara Gabriel, Waddell
A Yes vote on
200 will preserve consumer choice
As an Arizonan, I
highly value our state's independence and strong sense of community.
That's why I favor
public polices that protect and strengthen consumer choice. And, it's why I
oppose public policies that take our rights and choices as consumers away.
Many Arizonans freely
choose to obtain short-term (two week) loans provided by payday loan stores.
They do so for a variety of reasons. Some
choose this type of short-term credit to pay unexpected bills. Others find it
a simple and convenient way to get needed cash.
Whatever their reasons
for obtaining loans, I believe consumers are more qualified than the
government to make personal financial decisions. When the government starts
making financial decisions for us, then we're all in trouble.
I'm voting for Prop.
200 because it maintains an important financial option for consumers. And the
reforms within this proposal will strengthen this option.
In a time of tight
credit and lending troubles, we should do everything possible to preserve
financial options for consumers.
Dora McClarron, Tucson
George McGovern supports
preserving options for consumers
George McGovern is a former senator from South Dakota and the 1972 Democratic
presidential candidate. In March of 2008, he wrote a power opinion piece
called ‘Freedom Means Responsibility' in the Wall Street Journal.
Here are some excerpts from Mr. McGovern's column:
"Anguished at the fact that payday lending isn't perfect,
some people would outlaw the service entirely, or cap fees at such low levels
that no lender will provide the service. Anyone who's familiar with the law
of unintended consequences should be able to guess what happens next."
"Researchers from the Federal Reserve Bank of New York went one step
further and laid the data out: Payday lending bans simply push low-income
borrowers into less pleasant options, including increased rates of
bankruptcy. Net result: After a lending ban, the consumer has the same amount
of debt but fewer ways to manage it."
"Why do we think we are helping adult consumers by taking
away their options? We don't take away cars because we don't like some people
speeding. We allow state lotteries despite knowing some people are betting
their grocery money. Everyone is exposed to economic risks of some kind. But
we don't operate mindlessly in trying to smooth out every theoretical wrinkle
I urge you to consider Mr. McGovern's words as you weigh the
positive aspects of Prop 200. Please vote Yes.
Bill Harris, Gilbert
Reserve Staff Report Shows Consumers Hurt When Payday Loans Eliminated
A November 2007 staff report done for the Federal Reserve Bank
of New York
showed that consumers suffer financially when payday lending is banned in a
The study looked at the State of Georgia where payday lending was
banned in 2004.
It said, "Compared with households in all other states,
households in Georgia
bounced more checks, complained more to the Federal Trade Commission about
lenders and debt collectors, and filed for Chapter 7 bankruptcy protection at
a higher rate".
The Federal Reserve report goes on to say, "This negative
correlation--reduced payday credit supply, increased credit
problems--contradicts the debt trap critique of payday lending, but is
consistent with the hypothesis that payday credit is preferable to substitutes
such as the bounced-check "protection" sold by credit unions and
banks or loans from pawnshops".
This incisive report from one of our nation's most revered
financial institutions clearly makes the important yet simple case that
consumers are hurt when credit options are eliminated in the financial
Those who oppose the `Payday Loan Reform Act `seek to eliminate
the payday loan industry in Arizona
entirely... forcing borrowers to more costly options.
As the Federal Reserve report demonstrates, eliminating payday
lending in Arizona
would be bad public policy. Much better to reform the industry and preserve
the option for those who would choose to use it.
Kelli Carey, Mesa
200 Will Eliminate Loan Extensions
One of the key reforms in Prop 200 is a prohibition on loan
Under current law, consumers of payday loans can extend the same
two-week loan up to three times in Arizona.
As a result, consumers accumulate additional fees and the loan ends up
costing more than the consumer originally planned.
Prop 200 would change that because it creates a new state law
that prohibits a consumer from extending the same loan multiple times.
It also prohibits a consumer from taking out more than one loan
at a time in the state.
As a result of voting Yes on 200, payday lending stores would be
forced to charge fewer fees than they currently charge.
And, as a result of voting Yes on 200, consumers would be forced
to deal with their current debt obligations before taking on additional debt.
In the end, the payday loan stores will be held to a higher
level of accountability and consumers will be held to a higher level of
Reforming the payday lending industry in AZ is good public
Allan Cairns, Gilbert
200 will reign in unregulated off-shore internet lenders
Do an internet search for "payday
lending" and you'll find hundreds of internet lenders, often in foreign
countries, willing to do business.
These lenders are frequently not bound by Arizona laws and regulations.
They operate largely on the honor system. They'll gladly take
your fee and if you're lucky, you may see the loan.
Under Prop 200, off-shore internet payday lenders would be
subject to the same laws and regulations as brick and mortar AZ stores.
This is real consumer protection that Arizona needs now.
Vote Yes on Prop 200
Mark Johnson, Gilbert
Employee Urges Yes on 200
I work for a payday lending store in AZ and I'm proud of the
service we provide our customers.
The industry employees over 2,500 residents of the great state
I know firsthand the valuable option we provide for people who
need short-term loans to cover expenses.
Here are some of the reasons why my customers use our store:
To place a security deposit on a rental home or apartment
To avoid having their utilities cut off
To purchase food or prescription drugs for the family
To avoid missing a mortgage payment
To avoid bouncing a check
A Yes vote on Prop 200 will improve the payday lending industry
and ensure that this valuable service remains available to AZ consumers.
Vote Yes on 200.
Paul Beinlich, Chandler
200 forces the industry to set up free repayment plans
Under current law, consumers who have difficulty paying off an
outstanding short-term loan, don't have many options.
Some may borrow money from friends or relatives - Others may take out a
second loan to pay off the first.
Prop 200 would change that by mandating the industry to create a
no-cost repayment plan for customers that want to take advantage of such an
Here's how it would work:
Customer tells payday loan store he/she is having difficulty in
paying off loan
Payday store and customer enter into a repayment agreement
Customer is allowed up to 4 months to repay the loan
Payday store is prohibited from charging on any additional fees
on the loan
This reform is very beneficial because it will help customers
maintain their positive credit ratings and avoid having credit agencies
chasing them down for payment. And it will prevent payday loan stores from tacking
on additional fees.
This is the kind of payday loan Reform that I can vote for.
Dennis Lininger, Phoenix
Can Make Their Own Financial Decisions
The Payday Loan Reform Act makes pro-consumer changes to payday
lending in Arizona
while allowing the industry to continue to do business in our state. I
I've heard that some people want to eliminate payday loans in Arizona. But why would
someone want to do this?
When it comes to money, credit, and borrowing decisions...
people in Arizona
need more options, not less.
This Proposition will make sure payday lenders are tightly
regulated, more consumer friendly, and remain available to serve those people
who need a small, simple to understand, short-term loan.
I'm voting Yes.
Karyn Piña, Scottsdale
voting Yes on 200 because it's the right thing to do
Like a lot of people I have never used a payday loan service. In
my worst financial scenario I have turned to family. I couldn't understand
how anyone could use one of "those" places.
I've changed my mind about those places. I found out that their
customers must have a checking account, identification and a stable income.
It seems to me if consumers had a better option they would use it. Being an
ex-banker I know you can't go to your bank to borrow a small amount of cash
for emergencies and $35 for a bounced check when your account is only $3
overdrawn does not make good financial sense.
I'm voting for Prop 200 because I don't think government should
put a community needed service out of business. This reform is good because
it eliminates any possibility of out of control rollover. America is
about choice and opportunity.
Vote yes to give working people a choice.
Alice Lara, Phoenix
Payday loans less expensive than bank fees and charges
There's a very strong reason
that payday lending is so popular in Arizona:
The alternatives are more expensive!
A recent study done by an
economist from North Carolina ("Hidden Consumer Loans" July 2007)
found that bouncing a check with your bank costs twenty (20) times what a
payday loan would cost.
strange how little outrage there is about bank ATM fees, bounce protection
charges, late fees, overdraft protection charges, etc. etc. etc. But, when
you start adding all these things up, they can really put a dent in your
The profit margins of the
top banks are 26.52 percent compared to 6.6 percent for payday companies. The
banks profit margins are 301 percent greater, or four times higher, than the
five public payday advance companies.
Plus, when you add in the
bad credit ratings that are associated with bounced checks and other negative
banking options, the true cost of banks is significantly higher than a
two-week short term loan.
Here's an interesting
Proposed Payday Advance Fee
Offshore internet payday
advance fee: $25
Overdraft Protection Charge
(Source: bankrate.com): $27
Credit card late fee
(Source: Government Accountability Office): $37
Bounced check (fee to bank
and vendor) (Source: bankrate.com ): $54
Prop 200 will implement
necessary reforms while preserving this important option for consumers.
Oscar Foster, Scottsdale
be tricked by opponents claim of 400 percent interest
Payday loans are two-week loans - not annual loans!
Opponents frequently claim "400 percent annual percentage
rates" to misrepresent the truth and to help push their political
But, the typical fee charged by payday lenders is $15 per $100
borrowed, or a simple 15 percent for a two-week
The only way to reach the triple digit APRs quoted by critics is
to roll the two-week loan over 26 times or a full year!
This is unrealistic considering that Arizona makes it illegal to roll a loan
over more than 3 times. Prop 200 would make it illegal to roll any loan over.
Even if, hypothetically, the loan was rolled over for the entire
year, the APR of payday loans pales in comparison to the alternatives.
If you really want to play the APR game, let's see how a $100
payday loan compares?
$100 payday advance with a $15 fee = 391 percent APR
$100 bounced check with $54 NSF/merchant fees = 1,409 percent APR
$100 credit card balance with a $37 late fee = 965 percent APR
$100 utility bill with $46 late/reconnect fees = 1,203 percent
Vote YES on 200
Brian Crump, Tucson
Reform to Benefit Arizona
The Payday Loan Reform Act brings real reform to the payday loan
industry in Arizona.
Among the many meaningful changes that come with this Proposition, the Act
Mandate Lower Costs for payday loan customers
Prohibit loan extensions and the added fees that go with them
Create a new repayment plan at no cost to the customer for those
who have trouble meeting their obligations
Rein in unregulated and off shore internet lenders with
Increase minimum financial requirements for payday loan
companies, ensuring financial strength in the industry
Inhibit a customer's ability to have more than one loan at a
These reforms are real.
They are pro-consumer.
They are quantifiable.
They are measurable.
These reforms answer every unfounded assertion ever made by
opponents of the payday loan business in Arizona (most of whom
have never been in a payday loan store and talked to the hard-working
Arizonans that responsibly use this service).
And just as importantly, the Payday Loan Reform Act preserves
this important financial option for those people in Arizona that make the personal economic
decision to use it.
Enrico Torres, Peoria
is Better Than Elimination
I have followed some of the debate over payday loans in Arizona. It looks like
there are people that are doing their best to make payday loans illegal. They
even tried to make payday lending a Class 5 felony crime. What kind of zealot
thinks this is a good idea?
I don't get it.
Payday Loans are not for everyone, but for many people a payday
loan is the best and least expensive option they have. Why would someone want
to take this away?
Opponents of payday loans scream about interest rates, but this
Proposition would set a new, lower fee for a payday loan in Arizona at 15
dollars for every one hundred dollars borrowed.
If you need one hundred dollars today and you do not have it, a
payday loan at this price is much better than bouncing a check and getting
dinged by the retailer and the bank for more than 50 dollars... not to
mention what they do to your credit report.
Opponents to this Proposition have one clear political agenda,
and that is to eliminate payday loans in Arizona. The Payday Loan Reform Act is a
Scott Wagner, Phoenix
Prop 200 good for
consumers, Prop 200 good for Arizona
Arizonans use payday lending services everyday to meet
unforeseen expenses and financial emergencies.
The payday lending industry is set to be eliminated and the
Arizona Legislature refuses to enact reforms to benefit borrowers while
preserving this important financial option.
This measure will bring dramatic pro-consumer reform to payday
lending and preserve consumer choice.
A substantial rate cut,
Eliminates rolling-over principal to extend a loan,
Creates a repayment plan at no cost to customers that can't meet
And inhibits a borrower's ability to obtain more than one loan
at a time.
Please join me in approving these important reforms to the
payday lending industry and vote Yes on 200 on Nov. 4.
Mario E Diaz, Scottsdale
to not support the use of payday loans stores, but not anymore
At one point in my life, I thought of payday loan stores as
predatory, unnecessary and an eyesore.
Then one day, I educated myself on the issue. I have met many
people who use payday loans for a variety of legitimate reasons whether for
medical expenses, rent or mortgage increases, groceries or other short-term
needs. They simply did not have any other financial option and have found
that this option works best for them.
These emotionally moving stories made me realize that I should
not be so quick to judge payday loan stores in AZ. They provide a very
important financial service. Payday loans are just another financial tool.
They may be less conventional than many people are used to, but that does not
mean that they are not a creditable lending option.
Prop 200 keeps this financial option available and enacts
important pro-consumer reforms. Please join me in voting `yes' on Prop 200.
Wendy Villa, Phoenix
Loans Help People Who Need It
I am a single Mom.
Like many people in our state I am doing my best every day to
take care of my family, pay my bills, and meet my responsibilities.
There are times when the money will just not stretch far enough
to cover the month. When that happens, I'm glad there is a place I can go to
get a simple loan to get me through to the next payday.
Payday loan stores are convenient, the people that work there
are friendly, and they treat me with respect.
Someday I want to be in a place in my life where I will not need
to borrow money to make it to the next payday. But for where I am in my life
right now, I'm happy there is such a thing as a payday loan in Arizona.
I'll be voting for this Proposition that reforms payday loans.
Tiffany Escobedo, Peoria
Politicians love to hate the Payday loan industry
because most politicians have never bounced a check when they are buying
diapers at Wal-Mart. It's easy to get all parochial when you have overdraft
protection, direct deposit, American Express and a nice pension. So when a
politician sees a line outside a payday loan store, he figures that a $15 fee
is too much to pay for a $100 cash advance and he decides that he should take
that option away from those borrowers, you know..."for their own
in other states for example recently capped the interest rates on loans to
military personnel. That sounds like a great idea, but now those military
families can't obtain loans. So when they find themselves short of cash, they
have to risk bouncing checks or going without needed items. It's a lot more
expensive to bounce a check than it is to borrow from a payday lender.
legislators should force Wal-Mart not to charge for bounced checks, or force
banks to offer micro loans, or start counting bank fees as interest...after
all; paying a dollar to withdraw $20 from an ATM is a much higher interest
rate than a payday loan.
maybe politicians should stop pretending to be Alan Greenspan and just let
people make the choices that they believe are best for their families ...even
if they are Hispanic or in the Military.
‘Payday Loan Reform' act regulates the payday loan industry while preserving
the payday loan option for those who need it. Tell the politicians that they
need to start treating people like grown ups. Vote Yes on the Payday Loan
Greg Patterson, Scottsdale
Reform of the Payday Loan Industry
In this important campaign to reform the payday loan industry,
you will hear lots of noise from opponents. These activists will try to fool
you into believing that consumers don't need payday loans to balance their
life's financial necessities.
Here's a myth you will hear: "This is false reform"
Fact: Prop 200 imposes stringent and costly mandates on the
payday loan industry.
Here's a myth you will hear: "Payday lenders charge 400
Fact: The typical fee charged by lenders is $15 per $100
borrowed, or a simple 15 percent for a two-week
Here's a myth you will hear: "No means Yes"
Fact: Opponents want to confuse you into believing that a ‘no'
vote means reforming the industry. But only a ‘yes' vote will implement
Here's a myth you will hear: "Arizonans are better off
without payday loans."
Fact: States that eliminated short term loans saw increases in
bankruptcies, bounced checks and lender complaints.
Vote Yes on Prop 200
Robin Grenko, Phoenix
for Responsible Lending (Prop 200 opponent) Not Honest
Consumers across the nation benefit from short term loans.
Without them, many are left with only higher cost alternatives or with no
access at all to the financing that they need. The campaign to generate
public panic over these issues owes much to a sophisticated public relations
campaign carried out by the increasingly high-profile Center for Responsible
As the most visible face of the half-billion dollar team of
"Self-Help" non-profit organizations, CRL attacks competing loan
products. Under the guise of advocating in the interests of its low-income
customers, Self-Help makes loans at highly profitable rates and uncharitably
takes those low-income customers to court over trivial monetary sums. Worse, CRL's advocacy has worked to the disadvantage of
America's working poor and
low-income individuals often benefit from well-intentioned advocates. But
when those who claim to speak on behalf of the vulnerable use their position
to benefit themselves, it is an act of betrayal. The public record
demonstrates clearly that the CRL and its Self-Help network fit this profile.
CRL's research is
agenda-driven. Its advocacy has cost consumers more than it has
"saved" them, according to Federal Reserve research. It relies on
race-based claims to generate media interest. And it takes money from
self-interested Wall Street billionaires who profit from the mortgage crisis
so astutely hyped by CRL.
Federal records show Self-Help's credit union allows its
borrowers a much higher average loan rate compared to similar organizations,
a critique at odds with CRL's attacks on lenders
who extend too much money to those who may have trouble repaying their loan.
Finally, Self-Help loses its charitable image when it takes legal action
against its low-income customers.
There is a name for
such groups: predatory charity. Vote Yes on Prop 200.
James Terry, Chief
Public Advocate, Consumer's Rights League, Washington, DC
Roe, Treasurer Consumer's Rights League, Washington, DC
Paid for by "Consumers Rights League"
"Against" Proposition 200
AARP Arizona Urges a
"No" Vote: Payday Lenders' Reform Prop 200
AARP in Arizona
and nationally has been working to stop predatory lending practices that
victimize consumers. Payday loan operations in Arizona fall into this
category, by charging borrowers excessive interest rates, as high as 458
percent, thrusting them into situations where they cannot pay off the initial
debt and become embroiled in a never ending cycle of debt. Seniors on fixed
incomes, many of whom are AARP members, are particularly vulnerable to the
payday loan debt trap.
In addition, the state itself suffers from lost income amounting
to $139 million stripped from trapped borrowers in interest and fees, money
that leaves Arizona
due to out-of-state payday lending operations.
Arizonans have to pay interest rates on payday loans that far
exceed the usury rate of 36 percent for all other loans in the state. This
initiative would make 391 percent interest rates a permanent reality here. Other
states have been successful in protecting their citizens by forbidding payday
lending at triple-digit interest rates, and Arizona must follow suit.
Payday lenders have had free reign in Arizona because of a 10-year exemption
from the state's 36 percent usury cap that the Legislature granted in 2000.
Now they are using this initiative to try to extend the exemption
indefinitely. As for the "reforms" they profess to support, all of
them could be implemented now without the need for this initiative.
lenders make a profit at 36 percent interest and lower, and consumers are
protected from exorbitant rates and fees. There is absolutely no reason for
payday lenders to continue to reap exorbitant gains on the backs of
Vote No on Prop 200
Len Kirschner, M.D., State President, AARP of Arizona, Phoenix
David M. Mitchell, State Director, AARP
of Arizona, Phoenix
Paid for by
"AARP of Arizona"
Argument Against Prop 200
Payday Loan Reform Act
Arizona is suffering from a
down turn in its economy, and Arizonans need real solutions to personal
financial hardship. Prop 200 is a step in the wrong direction for Arizona. This
initiative was placed on the ballot by the Payday Loan industry, the very
same special interests who take advantage of Arizonans every chance they get.
Payday loans charge
interest rates in excess of 390 percent yet this industry purports to help Arizona's working
families. In reality their loans cause families to struggle even more when
times get bad. For example, the average Arizonan pays back nearly $1,300 on a
$500 payday loan. The Payday Loan "Reform" Act will not change
The real solution
cannot be found by offering Arizona's
working families a shovel to dig a deeper financial hole. Arizonans' needs
must be met with living wages and a future that includes financial security
for all. The Arizona Education Association requests that you vote No on Prop
President, Arizona Education Association, Phoenix
Andrew Morrill, Vice-President, Arizona Education Association, Phoenix
Paid for by
Statement in Opposition to the Payday
Loan Reform Act from the Society of St. Vincent de Paul
The Society of St.
Vincent de Paul is opposed to Proposition 200, the Payday Loan Reform Act.
The Society serves the poor and marginalized in our communities who come to
us as a last resort. A financial emergency temporarily solved by payday loans
all too often leads to a perpetual debt trap for inexperienced borrowers.
Proposition 200 does not reform this lending practice. Instead, it reduces
the annualized interest rate from more than 400 percent to 391 percent. It
also removes the current 2010 "sunset date" for payday lending in Arizona which will
allow payday lending to continue in our state for the foreseeable future.
Fifteen states and the District of
Columbia have banned triple digit payday loans.
Federal legislation prohibits payday lending to members of the military.
Proposition 200 is not in the best interest of Arizonans. The Society of St.
Vincent de Paul urges a "No" vote on Proposition 200.
Stephen J. Jenkins,
President, Phoenix Diocesan Council Society of St. Vincent de Paul, Phoenix
Joseph J. Riley, President-elect,
Phoenix Diocesan Council Society of St. Vincent de Paul, Phoenix
Paid for by
"Diocesan Council for the Society of St. Vincent de Paul Diocese of Phoenix"
Vote "No" to End Usury
Usury (Û's û·ry): The act of lending
money at an excessive interest rate. The payday loan industry and its seedy
storefronts offer Arizona
a stark contrast: a continuation of usurious loans by corporate loan sharks
who prey on the poor; or a sunset to this exploitative practice.
The payday loan law
legalizes deferred presentment, also known as check-kiting, which occurs when
a person writes a check for more than the checking account balance. This
unseemly practice is exacerbated by the lack of an interest rate cap. Unlike
many states that permit payday lenders, Arizona has no maximum interest rate for
consumer loans. While other states cap the interest at 25-36 percent, Arizona payday lenders
charge $87.50 ($17.50 per $100 borrowed) on a typical $500 loan. When made
payable within two weeks, that works out to an annual interest rate of 455
percent. If the industry and its cronies were sincere about reform, they
would cap the rate at 36 percent. Instead, the sky remains the limit.
Industry shills claim
that consumers should have the choice to engage in any financial transaction
in which they choose to engage. But payday loan customers are usually in no
position to bargain, and are forced to pay outrageous rates simply to stave
off, for a short time, a family emergency or other hard knocks. Then they
find themselves deeper in debt with no way out.
We can best help those
in need by protecting them from greed and exploitation. Arizona voters should note that a
recently-enacted federal law (10 U.S.C. § 987) bans lenders from charging
interest rates greater than 36 percent to members of the military. If an
interest rate cap is fair for our soldiers and sailors, it is fair for all
defeat greed; and vote "no".
Gary Restaino, Phoenix
urges a No Vote on Proposition 200!
WESTMARC is a regional coalition of business, government, and
education that advocates for good public policy. As a partnership between
business and government, it is paramount that we thoroughly consider public
policy issues and work collaboratively toward public policy that is good for
our West Valley region and our state.
WESTMARC has thoroughly reviewed Proposition 200 and believes
that the Payday Loan Reform Act will not be beneficial to our West Valley
region or our state.
WESTMARC believes that payday loan services:
can hurt neighborhoods and property values because of the stigma
associated with such operations;
can hurt military
installations such as Luke AFB where young, inexperienced, and low paid
military service personnel can be unwary targets for such operations.
WESTMARC also believes:
that this Initiative at the very least severely restricts and
most likely eliminates the Legislature's ability to further and better
regulate this industry in the future;
that the Legislature should be able to regulate this industry,
that since this Initiative is
paid for by the industry itself it is highly protectionist.
For the last two years WESTMARC has supported legislative
efforts to eliminate this industry based on the premises that their services
are usurious and that they are harmful to military employees and
WESTMARC believes that this Initiative is bad for Arizona's economy.
Therefore, we encourage you to join WESTMARC in opposing the
Payday Loan Reform Act and urge you to vote No on Proposition 200!
Ray L. Jones,
Chairman, WESTMARC, Peoria
Jack W. Lunsford, President & CEO,
Paid for by "WESTMARC"
Don't be fooled by the name given to
this initiative by the Payday Loan Industry. It will not "reform"
the mess we are in; things will only get worse because the mess will become
permanent. Reasonable people would consider the 391 percent interest rates
they want to continue charging nothing short of legalized loan-sharking.
Payday lenders are
notorious for making huge profits by exploiting the financial hardship of
people with limited resources, especially the poor and young people, and
those living near military bases and in low-income communities. Arizona voters should do what has been done in a dozen
other states and District of
Columbia: Put these predatory lenders out of
business unless they follow our existing laws which allow interest rates up
to 36 percent.
The Arizona Advocacy
Network urges defeat of Proposition 200. Its sponsors, the predatory lenders
who charge extremely high interest rates, have already contributed more than
$2.5 million to pay for signatures and support for an advertising blitz. We
don't have those kinds of resources, so we have to depend on the good sense
of voters to recognize what is at stake and vote against this measure.
The Arizona Advocacy
Network promotes social, economic, racial and environmental justice by
advocating for justice in those areas and by encouraging increased civic
participation and educating voters on ballot measures.
Michael J. Valder, President, Arizona
Advocacy Network, Phoenix
Eric Ehst, Treasurer, Arizona
Advocacy Network, Phoenix
Paid for by "Arizona Advocacy Network"
Lenders' Initiative Would be Bad for Arizona Consumers
As your Attorney General, it is my responsibility to protect Arizona's fair and
open marketplace. Access to credit at reasonable rates is critical for Arizona consumers,
especially in times of economic hardship.
The Payday Loan Reform Act would give payday lenders free reign
to charge triple-digit interest rates to Arizona consumers. This initiative is bad
for our economy and bad for consumers. I urge Arizonans to vote no.
Written by the payday loan industry's lobbyists and lawyers,
this act would create an indefinite, voter-protected mandate for interest
rates of 391 percent or more on small-dollar consumer loans.
Arizona law places a 36 percent
usury cap on consumer loans. For the past eight years, payday lenders have
used an exemption to exploit Arizona
consumers. If a majority votes no on this initiative, that exemption will
expire on July 1, 2010. If it passes, the exemption becomes permanent.
Payday lenders should no longer be allowed to charge more than
10 times what other lenders can charge. Arizonans should have access to
small-dollar loans at reasonable rates and be able to hold on to their
hard-earned wages. This can only be accomplished by voting no.
families and consumers is my top priority as Attorney General. The payday
loan industry wants to make excessive interest rates on short term loans
permanent in Arizona.
This initiative is bad public policy, and it harms Arizona consumers. I urge you to join me
in voting no.
Terry Goddard, Arizona
Attorney General, Phoenix
Paid for by
"Stop Payday Predators in Opposition to the Payday Loan Reform Act,
to 391 percent interest
I'm Senator Debbie McCune Davis, Democrat from Phoenix.
And, I'm Representative Marian McClure, Republican from Tucson.
Together we've served in the Arizona legislature for a combined total
of 30 years and during that time we haven't always seen eye to eye on the
issues. But one issue we've always agreed on is the need to stop predatory
payday loan interest rates that can exceed 400 percent.
Borrowers in Arizona
have long been protected from predatory rates by the state's 36 percent
interest usury cap, which is the upper limit lenders may charge. That
protection ended in 2000 when payday lenders were granted a temporary
exemption from the consumer loan rules on interest rates. That special
exemption is scheduled to end in 2010.
For the last few years the payday loan lobbyists have tried to
get lawmakers to repeal the sunset date and grant them the authority to
continue charging nearly 400 percent interest. In
each instance, lawmakers refused to give them another free pass from our
state lending laws. The payday lenders will repeal the sunset date with their
initiative which is the true objective of their initiative.
Now payday lenders are asking voters to make triple digit loans
a permanent law. It's simply not fair to charge nearly 400 percent interest. We urge you to join us in protecting Arizonans
paychecks by voting ‘No.'
Debbie McCune Davis, Arizona State
Senator, Legislative District 14, Phoenix
Marian McClure, Arizona
State Representative, Legislative
District 30, Tucson
Paid for by
"Stop Payday Predators in Opposition to the Payday Loan Reform Act,
on the predatory payday loan initiative
Your ‘No' vote will expand the national interest rate cap for
active military members to all Arizona
families, including our veterans.
We all know the problems with payday and car title loans. Their
neon signs have become a permanent fixture of our landscape and they trap
financially desperate people into unfair loans with interest rates of 391
percent or more. What is less known outside of military circles are how these
loan sharks prey on our service members.
But it makes sense when you think about it. Our young service
members and their immediate families often make too little money and are too
far from home to count on traditional support systems. When they find
themselves in financial crisis, they have nowhere to turn. It's stomach
churning to go to a military base and see how payday loan stores cluster
outside the gates, ready to take advantage of these brave men and women.
That's why Congress passed and the president signed the Military
Lending Act, prohibiting any lenders from charging a military member on
active duty or his or her immediate family, more than 36 percent interest.
Unfortunately the new law does not apply to retired or military members
when they are not on active duty status. These families deserve the same
kinds of protection from loan sharks that their active duty brethren receive.
In fact, it should simply be illegal to charge 391 percent interest.
The only way to make triple digit loans illegal in Arizona - and
protect all families - is to vote ‘No' on the predatory payday loan
Tom Yearout, United States Coast Guard
Paid for by "Stop Payday Predators in Opposition to the
Payday Loan Reform Act, I-16-2008"
on the predatory lending gimmick
Predatory payday lenders are spending millions to deceive voters
on a ballot measure that has one goal - protect their profits at the expense
of hardworking families who are desperate for cash and willing to put their
paychecks on the line.
Proposition 200 would write 391 percent annual interest into
law, granting one industry a permanent exemption from the 36 percent annual
interest rate cap on consumer loans. Payday lenders are trying to call this a
The so-called consumer protections in Proposition 200 include a
repayment plan that is only offered if a consumer knows to ask for it before
the due date. After that they are barred from negotiating any other repayment
plans for an entire year. The industry will track this information with a
consumer information database.
When you vote 'No' you are saying that all lenders should follow
the state 36 percent interest rate cap.
Every day we hear from families who are struggling to make ends
meet. Gas and groceries are more expensive but the paycheck hasn't gotten any
larger. The neon signs offer the false hope of a quick fix.
The truth is, the gap between your
bills and your income only grows when you borrow money at rates that exceed
400 percent. As a result, families are spending thousands of dollars on
over-priced financial services.
That's why SEIU Arizona urges you to vote ‘No' on Proposition
200, the predatory payday loan initiative. Your ‘No' vote will help thousands
of hard working families who turn to 400 percent loans out of desperation.
Vote ‘No' to restore common sense fair lending laws for all Arizona families.
Scott Washburn, SEIU AZ State Director, Phoenix
for by "Stop Payday Predators in Opposition to the Payday Loan Reform
Caught in the Payday Loan Debt Trap. I'm Voting No.
Payday loans trap people, plain and simple. I'm an educated,
professional woman, and they trapped me. I had no idea what the actual
interest was when I first took out a payday loan because they purposely made
it unclear. They told me it was "just $345 to borrow $300" and I
When I found out I was paying 391 percent interest - months
later, and only after reading the fine print - I was floored.
Like most people, I wasn't able to pay back that first loan in
the two-week window required. I ended up paying the interest over and over to
renew the loan for 2-week periods, and soon one loan became many. The payday
stores encouraged me to renew my loans. They made it so easy! Each time, they
collected their huge fee.
Payday loans ultimately led me to bankruptcy, as they do so many
others. At 391 percent APR interest, I just got trapped.
I could never pay the principal, and eventually, I couldn't even
pay the interest anymore to renew the loans. It got to the point where I was
paying more than $1,000 a month, all in interest, just to keep my payday
loans from defaulting!
This is the payday loan debt trap. It was a nightmare, and I'm
far from the only victim of it.
I'm asking the voters of Arizona
to help me put an end to this situation. Payday lenders should have to play
by the same rules as other lenders in the state, not get to write their own.
It's only fair.
It should be illegal to charge 391 percent interest. By voting No,
we can make it illegal again.
Please join me. Vote No on the Prop 200.
Tamara Sisk, Mesa
for by "Stop Payday Predators in Opposition to the Payday Loan Reform
Others Be Victimized: Vote No
As a corrections officer, I give back to my community every day.
I work hard to earn an honest living and support my family. Payday loans
almost ruined my life.
Two years ago, I needed to pay some old bills so we could buy
our first home. My wife told me about payday loans. I was apprehensive, so we
borrowed only $300 and paid back $349 two weeks later. But that prevented us
from being able to pay the electricity bill. We still had more bills, and the
payday loan companies were sending us mail encouraging another loan, so we
tried one of $500.
The payback two weeks later on that $500 was $582, and we didn't
have it. Since we couldn't pay the full amount, we were told to just pay the
interest, $82, to renew the loan for another two weeks. Of course, two weeks
later, we had to renew it again for another $82. My wife and I started to
fall behind on our bills, and took out another payday loan to try to make
The payday loan companies will keep you in their grasp. I ended
up just paying interest, over and over again, every two weeks. I was stuck.
If a friend had not bailed me out, I'd still be in the payday
loan debt trap, paying $328 a month in interest to forever extend $1,000 in
loans. My original "short-term fix" turned into two years of
long-term debt and nearly cost me my home, my marriage.
I got caught because of the 391 percent interest, and that's
what the lenders are trying to get away with now. Help me prevent others from
ever having to go through this.
Vote No on Prop 200.
Ivan Polanco, Tucson
for by "Stop Payday Predators in Opposition to the Payday Loan Reform
Proposed By Initiative
Petition Relating To Payday Loans
Payday Loan Reform Act
EXTENDS PAYDAY LICENSING PROGRAM
INDEFINITELY; ALLOWS ELECTRONIC DEBIT AGREEMENTS; PROHIBITS SERVICES OVER 35
DAYS; REQUIRES ENGLISH OR SPANISH AGREEMENTS; PROHIBITS CERTAIN FEES;
REQUIRES PAYMENT PLAN IF REQUESTED; PROHIBITS ARRANGEMENTS WITH CUSTOMERS
HAVING OUTSTANDING REPAYMENT PLANS; ALLOWS LICENSEE TO MAKE OTHER LOANS;
REQUIRES LICENSEE TO MAINTAIN MINIMUM AND MAXIMUM NET WORTH.
A "yes" vote
shall have the effect of repealing the July 1, 2010 termination date for the
existing "payday loan" licensing program thus allowing it to
continue indefinitely, allowing payday loan licensees to provide electronic
debit agreement services, prohibiting services over 35 days, requiring payday
loan agreements be in English or Spanish, prohibiting certain fees,
permitting only one payday loan transaction with a customer each business
day, requiring a payment plan if requested by the customer, prohibiting
arrangements with customers having outstanding repayment plans, allowing
licensees to make other loans and requiring licensee applicants to maintain a
minimum net worth of at least $50,000 per location up to a maximum of
A "no" vote shall have the effect of retaining
the current law regarding payday loans, which are to terminate on July 1,
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