Safe Affordable Small Dollar Loan Act of 2010 - Amends the Community Development Banking and Financial Institutions Act of 1994 to require the Community Development Financial Institutions Fund to make grants to community development financial institutions or to any related partnership in order to enable such institutions to establish a loan-loss reserve fund to defray the costs of a small dollar loan program.
Requires a community development financial institution to provide non-federal matching funds equal to 50% of the amount of any grant received.
Prohibits the use of such grants to make direct loans to consumers.
Permits a community development financial institution to use such a grant to: (1) help recapture a portion or all of a defaulted loan made under its small dollar loan program; and (2) designate and utilize a fiscal agent for services the agent normally provides.
Requires the Fund to make technical assistance grants to community development financial institutions to support and maintain a small dollar loan program.
[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4694 Introduced in House (IH)]
111th CONGRESS
2d Session
H. R. 4694
To amend the Community Development Banking and Financial Institutions
Act of 1994 to provide financial assistance to community development
financial institutions to help defray the costs of operating small
dollar loan programs, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 25, 2010
Ms. Speier (for herself, Mr. Himes, Mr. Polis of Colorado, Mr.
Gonzalez, Ms. Eshoo, Ms. Zoe Lofgren of California, Ms. Chu, Mr. Lynch,
Mr. Hinojosa, Mr. Baca, Ms. Moore of Wisconsin, Mr. Perriello, Mr. Al
Green of Texas, Ms. Clarke, and Mr. Moore of Kansas) introduced the
following bill; which was referred to the Committee on Financial
Services
_______________________________________________________________________
A BILL
To amend the Community Development Banking and Financial Institutions
Act of 1994 to provide financial assistance to community development
financial institutions to help defray the costs of operating small
dollar loan programs, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Safe Affordable Small Dollar Loan
Act of 2010''.
SEC. 2. GRANTS TO ESTABLISH LOAN-LOSS RESERVE FUNDS.
The Community Development Banking and Financial Institutions Act of
1994 (12 U.S.C. 4701 et seq.) is amended by adding at the end the
following:
``SEC. 122. GRANTS TO ESTABLISH LOAN-LOSS RESERVE FUNDS.
``(a) Purposes.--The purposes of this section are to--
``(1) make financial assistance available from the Fund in
order to help community development financial institutions
defray the costs of operating small dollar loan programs, by
providing the amounts necessary for such institutions to
establish their own loan loss reserve funds to mitigate some of
the losses on such small dollar loan programs; and
``(2) encourage community development financial institution
to establish and maintain small dollar loan programs that would
help give consumers access to mainstream financial institutions
and combat payday lending.
``(b) Grants.--
``(1) Loan-loss reserve fund grants.--The Fund shall make
grants to community development financial institutions or to
any partnership between such community development financial
institutions and any other federally insured depository
institution with a primary mission to serve targeted investment
areas, as such areas are defined under section 103(16), to
enable such institutions or any partnership of such
institutions to establish a loan-loss reserve fund in order to
defray the costs of a small dollar loan program established or
maintained by such institution.
``(2) Matching requirement.--A community development
financial institution or any partnership of institutions
established pursuant to paragraph (1) shall provide non-Federal
matching funds in an amount equal to 50 percent of the amount
of any grant received under this section.
``(3) Use of funds.--Any grant amounts received by a
community development financial institutions or any partnership
between or among such institutions under paragraph (1)--
``(A) may not be used by such institution to
provide direct loans to consumers;
``(B) may be used by such institution to help
recapture a portion or all of a defaulted loan made
under the small dollar loan program of such
institution; and
``(C) may be used to designate and utilize a fiscal
agent for services normally provided by such an agent.
``(4) Technical assistance grants.--The Fund shall make
technical assistance grants to community development financial
institutions or any partnership between or among such
institutions to support and maintain a small dollar loan
program. Any grant amounts received under this paragraph may be
used for technology, staff support, and other costs associated
with establishing a small dollar loan program.
``(c) Definitions.--For purposes of this section, the following
definitions shall apply:
``(1) Consumer reporting agency that compiles and maintains
files on consumers on a nationwide basis.--The term `consumer
reporting agency that compiles and maintains files on consumers
on a nationwide basis' has the same meaning given such term in
section 603(p) of the Fair Credit Reporting Act (15 U.S.C.
1681a(p)).
``(2) Small dollar loan program.--The term `small dollar
loan program' means a loan program under which a community
development financial institution or any partnership between or
among any such institutions offers loans to consumers that--
``(A) are made in amounts not exceeding $2,500;
``(B) must be repaid in installments;
``(C) have no pre-payment penalty;
``(D) the institution has to report payments
regarding the loan to at least 1 of the consumer
reporting agencies that compiles and maintains files on
consumers on a nationwide basis; and
``(E) meet any other affordability requirements as
may be established by the Administrator.
``(d) Report to Congress.--Before the end of the 1-year period
beginning on the date of the enactment of the Safe Affordable Small
Dollar Loan Act of 2010, and each year thereafter, the Administrator
shall submit to the Committee on Banking, Housing, and Urban Affairs of
the Senate and the Committee on Financial Services of the House of
Representatives a report describing--
``(1) the activities carried out by the Fund pursuant to
this section; and
``(2) any measurable results, as appropriate and available,
related to the achievement of the purposes of this section as
described in subsection (a).
``(e) Authorization of Appropriations.--
``(1) Grant program.--There are authorized to be
appropriated for fiscal years 2010 through 2015 such sums as
may be necessary to carry out the grant program established
under this section.
``(2) Administrative expenses.--There is authorized to be
appropriated to the Fund for each fiscal year beginning in
fiscal year 2010, an amount equal to the amount of the
administrative costs of the Fund for the operation of the grant
program established under this section.''.
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Introduced in House
Introduced in House
Referred to the House Committee on Financial Services.
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