Michigan Senate Bill SB0830

Michigan 2025-2026 Regular Session

• Introduced: 3/10/26
• Refer: 3/10/26

Caption

Financial institutions: small loan companies; licensed providers of deferred presentment service transactions to make certain small loans; allow. Amends title & secs. 2, 11, 13, 15, 17, 19, 22, 31, 32, 33, 34, 35, 36, 45, 48 & 53 of 2005 PA 244 (MCL 487.2122 et seq.) & adds secs. 24, 25, 31a & 32a.

Impact

SB 0830 addresses the need for oversight in the deferred presentment market by establishing robust licensing procedures and defining clear operational standards for service providers. By enforcing a system that mandates proper licensing, the bill intends to enhance consumer protection in Michigan. In terms of loans, the bill allows for personal loans up to $2,000 with specified terms regarding repayment schedules and clearly outlines the conditions under which loans can be extended. The bill also establishes penalties for non-compliance, aiming to regulate the behavior of service providers effectively.

Summary

Senate Bill 0830 aims to regulate the business of providing deferred presentment service transactions in Michigan. The bill updates the existing Deferred Presentment Service Transactions Act originally enacted in 2005, introducing requirements for licensing providers of these transactions and allowing licensed providers to extend certain small loans. Notably, the bill includes provisions aimed at promoting financial literacy among customers, such as allowing for the creation of educational programs and setting up a consumer education and financial services access and literacy fund.

Contention

Despite its intentions, SB 0830 may encounter criticism regarding the limits it imposes on deferred presentment service providers and the associated costs of compliance. Stakeholders, including financial institutions and consumer advocates, may have differing opinions on the potential effects these regulations will have on the availability of services and their costs. Additionally, some may argue that the financial education initiatives as prescribed in the bill do not sufficiently address the underlying issues facing consumers who rely on these financial services.

Regulatory framework

The bill establishes a regulatory framework whereby licensees must perform comprehensive eligibility checks via a state-maintained database and is required to retain documentation pertaining to transaction histories and customer complaints. It empowers the state commissioner to monitor compliance and manage enforcement actions, emphasizing the role of consumer advocacy and protection in the financial services landscape.