Removing Barriers Blog

Missouri Legislature Considers Parity, Prize Linked Savings and Payday Lending Legislation
Posted January 07, 2016 by Chandler Schuette

When Missouri’s legislature convened on Wednesday, January 6, lawmakers were met with legislation, H 1721, that would permit the supervisory committees of state chartered credit unions to align their examination procedures with those of federally chartered credit unions. The intent of the measure is to provide parity and ensure state chartered credit unions and federally chartered credit unions fall under the same account verification requirements. The Heartland Credit Union Association (HCUA) supports the bill and views it as an improvement for Missouri credit unions as they currently have to do a full verification while federal charters do not.  Under federal law, credit unions are required to perform account verification once every two years, either by statistical sampling or by 100% verification.

A HCUA-backed prize linked savings bill, S 833, was also introduced. The bill allows federally insured financial institutions, including credit unions, to offer prize linked savings or savings promotion programs. These programs are designed to motivate participants to save money by offering cash prizes linked to their savings account(s). The more a participant saves, the more opportunities they have to win. Participants retain the savings, even if they don't win a prize.

Also in Missouri this week, two bills, H 1881 and S 647, were introduced that would impose new restrictions on payday lending. The new restrictions would include limitations on the number of simultaneous loans made to borrowers and new notice requirements that lenders must provide to borrowers.