The NCUA Board voted yesterday 2-0 to open a 60-day comment period on a proposed rule which will allow credit unions additional options when offering payday alternative loans. This will not replace the current Payday Alternative Loans (PALs) Program that the NCUA has, rather it would supplement it. Amendments proposed include:
- Length of Membership Requirement: eliminated
- Number of Loans: no restriction on number of loans in a certain amount of time
- Loan Amounts: no minimum; maximum $2,000
- Loan Term: min one month; max 12 months.
For years, LSCU has taken a leadership role in working to reform the payday industry at the state level, and we have been in continuous contact with the NCUA on this issue. LSCU will continue to be an industry leader on payday reform and is looking forward to offering our comments. We encourage all credit unions to engage in this effort. Should you have any questions or need more information, please contact Mike Lee, LSCU’s Director of Regulatory Advocacy.