Small loans maximum amount

AN ACT Relating to the maximum principal amount of small loans; 1
and amending RCW 31.45.073. 2
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:3
Sec. 1. RCW 31.45.073 and 2009 c 510 s 3 are each amended to 4
read as follows: 5
(1) No licensee may engage in the business of making small loans 6
without first obtaining a small loan endorsement to its license from 7
the director in accordance with this chapter. An endorsement will be 8
required for each location where a licensee engages in the business 9
of making small loans, but a small loan endorsement may authorize a 10
licensee to make small loans at a location different than the 11
licensed locations where it cashes or sells checks. A licensee may 12
have more than one endorsement. 13
(2)(a) A licensee must set the due date of a small loan on or 14
after the date of the borrower's next pay date. If a borrower's next 15
pay date is within seven days of taking out the loan, a licensee must 16
set the due date of a small loan on or after the borrower's second 17
pay date after the date the small loan is made. The termination date 18
of a small loan may not exceed the origination date of that same 19
small loan by more than ((forty-five)) 45 days, including weekends 20
and holidays, unless the term of the loan is extended by agreement of 21
H-2559.1
HOUSE BILL 2361
State of Washington 69th Legislature 2026 Regular Session
By Representatives Donaghy, Hackney, and Fosse
Prefiled 01/09/26. Read first time 01/12/26. Referred to Committee
on Consumer Protection & Business.
p. 1 HB 2361
both the borrower and the licensee and no additional fee or interest 1
is charged. The maximum principal amount of any small loan, or the 2
outstanding principal balances of all small loans made by all 3
licensees to a single borrower at any one time, may not exceed 4
((seven hundred dollars )) $1,200, adjusted for inflation based upon 5
changes in the consumer price index as provided in (b) of this 6
subsection, or ((thirty)) 30 percent of the gross monthly income of 7
the borrower, whichever is lower. A licensee is prohibited from 8
making a small loan to a borrower who is in default on another small 9
loan until after that loan is paid in full or two years have passed 10
from the origination date of the small loan, whichever occurs first.11
(b) Beginning January 1, 2027, and annually thereafter, the 12
department of financial institutions shall calculate the inflation-13
adjusted maximum principal amount of any small loan, or the 14
outstanding principal balances of all small loans made by all 15
licensees to a single borrower, at any one time allowed under (a) of 16
this subsection, by calculating to the nearest cent using the 17
consumer price index. The department of financial institutions shall 18
publish the information on its website and in a press release. For 19
the purposes of this subsection (2), "consumer price index" means the 20
consumer price index for all urban consumers, all items, for the 21
Seattle area as calculated by the United States bureau of labor 22
statistics or its successor agency.23
(3) A licensee is prohibited from making a small loan to a 24
borrower in an installment plan with any licensee until after the 25
plan is paid in full or two years have passed from the origination 26
date of the installment plan, whichever occurs first.27
(4) A borrower is prohibited from receiving more than eight small 28
loans from all licensees in any ((twelve)) 12-month period. A 29
licensee is prohibited from making a small loan to a borrower if 30
making that small loan would result in a borrower receiving more than 31
eight small loans from all licensees in any ((twelve)) 12-month 32
period. 33
(5) A licensee that has obtained the required small loan 34
endorsement may charge interest or fees for small loans not to exceed 35
in the aggregate ((fifteen)) 15 percent of the first ((five hundred 36
dollars)) $500 of principal. If the principal exceeds ((five hundred 37
dollars)) $500, a licensee may charge interest or fees not to exceed 38
in the aggregate ((ten)) 10 percent of that portion of the principal 39
in excess of ((five hundred dollars )) $500. If a licensee makes more 40
p. 2 HB 2361
than one loan to a single borrower, and the aggregated principal of 1
all loans made to that borrower exceeds ((five hundred dollars)) $500 2
at any one time, the licensee may charge interest or fees not to 3
exceed in the aggregate ((ten)) 10 percent on that portion of the 4
aggregated principal of all loans at any one time that is in excess 5
of ((five hundred dollars )) $500. The director may determine by rule 6
which fees, if any, are not subject to the interest or fee 7
limitations described in this section. It is a violation of this 8
chapter for any licensee to knowingly loan to a single borrower at 9
any one time, in a single loan or in the aggregate, more than the 10
maximum principal amount described in this section.11
(6) In connection with making a small loan, a licensee may 12
advance moneys on the security of a postdated check. The licensee may 13
not accept any other property, title to property, or other evidence 14
of ownership of property as collateral for a small loan. The licensee 15
may accept only one postdated check per loan as security for the 16
loan. A licensee may permit a borrower to redeem a postdated check 17
with a payment of cash or the equivalent of cash. The licensee may 18
disburse the proceeds of a small loan in cash, in the form of a 19
check, or in the form of the electronic equivalent of cash or a 20
check. 21
(7) No person may at any time cash or advance any moneys on a 22
postdated check or draft in excess of the amount of goods or services 23
purchased without first obtaining a small loan endorsement to a check 24
casher or check seller license. 25
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p. 3 HB 2361