H.F. 382 Section 1. Section 533D.9, subsections 2 and 3, Code 2013, 1 are amended to read as follows: 2 2. A licensee shall give to the maker of the check, at the 3 time any delayed deposit service transaction is made, or if 4 there are two or more makers, to one of them, notice written in 5 clear, understandable language disclosing all of the following: 6 a. The fee to be charged for the transaction. 7 b. The annual percentage rate as computed pursuant to the 8 federal Truth in Lending Act. 9 c. The date on which the check will be deposited or 10 presented for negotiation. 11 d. Any penalty, not to exceed fifteen dollars, which the 12 licensee will charge if the check is not negotiable on the 13 date agreed upon. A penalty to be charged pursuant to this 14 section shall only be collected by the licensee once on a check 15 no matter how long the check remains unpaid. A penalty to be 16 charged pursuant to this section is a licensee’s exclusive 17 remedy and if a licensee charges a penalty pursuant to this 18 section no other penalties under this chapter or any other 19 provision apply. 20 e. That the licensee cannot initiate debt collection 21 procedures, civil court proceedings, or arbitration to collect 22 an unpaid check unless the licensee has provided the maker of 23 the check the opportunity to agree to repay the obligation as 24 provided in section 533D.9A. 25 3. a. In addition to the notice required by subsection 26 2 , every licensee shall conspicuously display a schedule of 27 all fees, charges, and penalties for all services provided by 28 the licensee authorized by this section . The notice shall be 29 posted at the office and every branch office of the licensee. 30 b. A licensee shall not accept payment from a maker of a 31 check who appears in person at the delayed deposit services 32 business location for the purpose of repaying the obligation in 33 lieu of the check being deposited or presented for negotiation 34 without first providing written notice of the installment 35 -1- LSB 2365YH (3) 85 rn/sc 1/ 3

H.F. 382 payment option provided in subsection 2. 1 Sec. 2. NEW SECTION . 533D.9A Installment payments —— 2 requirements. 3 1. A licensee shall not initiate debt collection 4 procedures, civil court proceedings, or arbitration to collect 5 an unpaid check unless the licensee has provided the maker of 6 the check the opportunity to agree to repay the obligation 7 in biweekly installments, or installments that correspond to 8 the maker’s next four paydays if the pay period is more than 9 a week in duration and less than two weeks in duration. A 10 licensee may not require the maker of a check to pay more than 11 twenty-five percent of the obligation in any one installment 12 payment, but the maker of the check may elect to pay a larger 13 amount. 14 2. In lieu of the penalty imposed pursuant to section 15 533D.9, subsection 2, paragraph “d” , a one-time fee of ten 16 dollars shall be charged at the time the installment agreement 17 is entered into. During the repayment period, a licensee may 18 not transfer or sell the debt owing on the unpaid check, and 19 the loan shall not be considered to be in default. The maker 20 of the check’s failure to make a payment under the installment 21 arrangement shall place the loan in default and the licensee 22 may, after proper notice, exercise rights against the maker 23 under the law. 24 Sec. 3. Section 533D.10, subsection 1, Code 2013, is amended 25 by adding the following new paragraph: 26 NEW PARAGRAPH . g. Engage in deception, misrepresentation, 27 or subterfuge intended to evade the requirements of this 28 chapter. 29 EXPLANATION 30 This bill modifies provisions applicable to delayed deposit 31 services businesses. 32 The bill provides that a delayed deposit services business 33 licensee must disclose to a maker of a check that the licensee 34 cannot initiate debt collection proceedings to collect an 35 -2- LSB 2365YH (3) 85 rn/sc 2/ 3

H.F. 382 unpaid check unless the licensee has provided the maker of the 1 check the opportunity to agree to repay the obligation. The 2 bill provides that the obligation may be repaid in biweekly 3 installments or installments that correspond to the maker’s 4 next four paydays if the duration of the pay period is more 5 than a week but less than two weeks, that a licensee may not 6 require the maker of a check to pay more than 25 percent of 7 the obligation in any one installment payment, and that in 8 lieu of the $15 penalty otherwise applicable if payment is not 9 made, a one-time fee of $10 shall be charged at the time the 10 installment agreement is entered into. The bill adds that it 11 must also be disclosed that during the repayment period the 12 licensee may not transfer or sell the debt owing on the unpaid 13 check, and the loan shall not be considered to be in default 14 until the maker of the check fails to make a payment under the 15 installment arrangement. 16 The bill provides that a licensee shall not accept payment 17 from a maker of a check who appears in person at the delayed 18 deposit services business location for the purpose of repaying 19 the obligation in lieu of the check being deposited or 20 presented for negotiation without first providing written 21 notice of the installment payment option. 22 The bill provides that engaging in deception, 23 misrepresentation, or subterfuge intended to evade the 24 requirements of Code chapter 533D shall be considered 25 a prohibited act subject to the Code chapter’s penalty 26 provisions, which include suspension or revocation of a license 27 and a civil penalty of up to $5,000 per violation. 28 -3- LSB 2365YH (3) 85 rn/sc 3/ 3