Modifies provisions governing traditional installment loan lenders
The bill concentrates regulatory powers concerning installment lending at the state level, prohibiting any local governmental authority from enacting measures that could restrict or impose disincentives on traditional installment loan lenders. This change could significantly impact communities by limiting their ability to tailor lending practices to meet local economic conditions or consumer needs, thereby raising concerns about consumer protection and fair lending practices.
Senate Bill 974 aims to modify existing provisions governing traditional installment loan lenders in the state of Missouri. The bill seeks to repeal and replace Section 408.512 of the Revised Statutes of Missouri, allowing licensed traditional installment loan lenders to offer loans with terms defined under specific statutes while imposing restrictions on local governments. The primary objective is to ensure that local ordinances, policies, or rules cannot impose additional limitations or discourage these lenders from operating or charging fees as permitted under state law.
Notably, the bill does permit exceptions where local ordinances already in place prior to August 28, 2014, would still apply to traditional installment loan lenders. Nonetheless, the overarching nature of the bill raises essential questions about the balance between state authority and local governance, as local governments often argue for their rights to legislate on matters affecting their residents, especially regarding financial products that can significantly impact borrowers' lives.