Selma City Council members have extended the city's moratorium on new payday loan stores and may extend a ban on issuing new liquor licenses.
Officials voted Tuesday to extend the payday loan store ban for six months. Councilman Michael Johnson says he's researching future restrictions on the businesses, including requiring a certain distance between locations.
A state judge has thrown out a lawsuit from payday lenders looking to challenge regulations requiring a central database to track payday loans.
The Montgomery Advertiser reports a Montgomery judge ruled that the State Banking Department didn't exceed its authority last year by ordering a $500 cap on payday loans and a database to make sure consumers didn't have multiple loans out for more than that amount at one time.
About 50 people rallied on the Statehouse steps in Montgomery to show their support for legislation limiting interest rates on payday and title loans.
Members of the Alliance for Responsible Lending gathered Tuesday to support bills from Democratic Rep. Rod Scott of Fairfield and Patricia Todd of Birmingham that limit interest to 36 percent. The group backing the bills includes representatives of Alabama Appleseed, the Alabama Federation of Republican Women, the state NAACP, and AARP.
Governor Robert Bentley announced a new consumer protection measure today aimed at helping people avoid excessive amounts of debt from payday loans.
The measure will also help lenders by providing a method to ensure they are complying with state law. Under the Alabama Deferred Presentment Services Act, payday lenders are not to issue loans to customers who currently have more than 500 dollars in existing payday loan debt.
Several Alabama legislators are proposing bills to place restrictions on payday and title loans, including capping the interest rates.
Legislators say their bills would limit annual interest rates at 36 percent. The loans can now have annualized rates of 456 percent on payday loans and 300 percent on title loans.
Democrat Ron Scott of Fairfield says he's optimistic about passage because the bills have a broad range of support, including the Southern Poverty Law Center, NAACP, AARP and Arise Citizens' Policy Project.
A coalition of groups is pushing legislation to place tighter regulations on payday and title loans, including limiting interest to 36 percent annually.
The groups, including the Southern Poverty Law Center, Arise Citizens' Policy Council and AARP, say payday loans and title loans are a paradise for predatory lenders. At a news conference Thursday, they said interest rates can hit 456 percent annually for payday loans and 300 percent for title loans. In addition to limiting interest rates, they are proposing bills that limit the number of loans a borrower can get each year.
New payday loan businesses won't be allowed to open in Birmingham until at least next June. The city council on Tuesday extended a ban on the businesses until June 19, 2013. Officials picked that date because it comes after the end of the Legislature's regular session. They want lawmakers to address the number of payday loan businesses in their city and across Alabama during the session. An industry lobbyist criticized the move. Max Woods of Borrow Smart America said the decision hurts customers and small businesses. He also said it doesn't address problems with banks.