Bill > SB368

This bill modifies state law regarding interest rates and regulations for small loans, introducing several key provisions to protect consumers. The legislation caps the annual percentage rate (APR) for loans at 36%, prohibiting lenders from using various tactics to circumvent this limit, such as disguising loan proceeds as cash rebates or creating complex financial arrangements to avoid rate restrictions. The bill requires lenders to obtain a license from the state's finance division, pay an annual fee of $600 per location, and post clear notices about their maximum interest rates and loan terms. For small loans under $500, lenders must now consider the borrower's ability to repay, allow loan renewals with a requirement to reduce the principal by at least 5% on each renewal (with a maximum of six renewals), and provide borrowers the option to cancel a loan without cost within one business day. The bill also establishes new definitions for consumer installment loans and imposes stricter reporting and compliance requirements on lenders. Importantly, the bill will be submitted to voters for approval in the November 2026 election and will only take effect if approved by a majority of voters.

Business and Industry

https://www.senate.mo.gov/25info/BTS_Web/Bill.aspx?SessionType=R&BillID=464