Last year, Alabamians took out more than two million payday loans, according to the state’s Banking Department.
At the inaugural meeting of the Alabama Consumer Protection Task Force on Wednesday the Alabama Banking Department revealed the new figures, which indicate borrowers have taken an average of eight loans each since the a loan-tracking database was created in August of 2015. According to the data, there were 246,824 unique borrowers.
The average loan was for $326, with an average fee of $56, and was paid back in roughly 20 days.
The Banking Department began tracking the loans after winning a court case over the creation of the database to enforce an existing law, which limits consumers to having no more than $500 in payday loans at any given time.
Figures revealed Wednesday, showed about 400,000 additional loans were declined.
“We’ve got to make sure consumers are protected. I want our companies to make a reasonable profit. They have to. They can’t stay in business if they don’t, but we have to protect,” Governor Robert Bentley said at the meeting.
Bentley created the Task Force through Executive Order 21 on June 14 to evaluate at and suggest changes to all of the state’s consumer credit laws, which apply to entities from mortgage brokers to pawn shops. Members of the Task Force are working to identify areas of Alabama’s consumer credit laws for possible revision or new legislation.
The Task Force is comprised of 33 experts appointed by various stakeholder organizations including the Office of the Governor, Alabama Legislature, Alabama Law Institute, Attorney General’s Office, Alabama Bar Association, Alabama State Baking Department, Alabama Department of Insurance, State of Alabama Credit Union Administration, Alabama Appleseed, Arise Citizen Policy Project, Southern Poverty Law Center, AARP, Alabama Pawnbrokers Association, Community Financial Services Association, Mortgage Bankers Association of Alabama, Alabama Mortgage Professionals Association, Alabama Lenders Association, Alabama Consumer Finance Association, American Financial Services Association, Alabama Bankers Association, Alabama Credit Union Association and the Alabama Securities Commission.