Report Title:

Check Cashing; Deferred Deposits; Limits and Fees; Increased

Description:

Lengthens the deferral period of a check from thirty-one to thirty-two days. Increases the maximum for transaction fees, the total amount of outstanding deferred deposit transactions, and the dishonored check fee.

THE SENATE

S.B. NO.

1059

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to check cashing.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Section 480F-4, Hawaii Revised Statutes, is amended to read as follows:

"[[]480F-4[]] Deferred deposits, when allowed. (a) No check casher may defer the deposit of a check except as provided in this section.

(b) Each deferred deposit shall be made pursuant to a written agreement that has been signed by the customer and the check casher or an authorized representative of the check casher. The written agreement shall contain a statement of the total amount of any fees charged for the deferred deposit, expressed both in United States currency and as an annual percentage rate. The written agreement shall authorize the check casher to defer deposit of the personal check until a specific date not later than [thirty-one] thirty-two days from the date the written agreement was signed. The written agreement shall not permit the check casher to accept collateral.

(c) [The face amount of the check shall not exceed $300 and the] The deposit of a personal check written by a customer pursuant to a deferred deposit transaction may be deferred for no more than [thirty-one] thirty-two days. A check casher may charge a fee for deferred deposit of a personal check in an amount not to exceed [fifteen] twenty per cent of the face amount of the check. Any fees charged for deferred deposit of a personal check in compliance with this section shall be exempt from chapter 478.

(d) A check casher [shall not] may enter into an agreement for deferred deposit with a customer during the period of time that an earlier agreement for a deferred deposit for the same customer is in effect[. A deferred deposit transaction shall not be repaid, refinanced, or consolidated by or with the proceeds of another deferred deposit transaction.]; provided that the aggregate total dollar value at any one time of all checks of the customer accepted for deferred deposit shall not exceed $600.

(e) A check casher who enters into a deferred deposit agreement and accepts a check passed on insufficient funds, or any assignee of that check casher, shall not be entitled to recover damages in any action brought pursuant to or governed by chapter 490. Instead, the check casher may charge and recover a fee for the return of a dishonored check in an amount not greater than [$20] $25.

(f) No amount in excess of the amounts authorized by this section and no collateral products such as insurance shall be directly or indirectly charged by a check casher pursuant or incident to a deferred deposit agreement."

SECTION 2. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 3. This Act shall take effect upon its approval.

INTRODUCED BY:

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