AK: Testimony in Support of Alaska HB 145

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TO: Alaska House Finance Committee

FROM: Elizabeth Gorz, Chief Strategy Officer and Legislative Affairs, American Fintech Council (AFC)

DATE: April 24, 2024

SUBJECT: House Bill 145

Position: Support.

Testimony:

Thank you, Co-Chairs Foster and Johnston, Vice-Chair Ortiz, and members of the House Finance Committee for the opportunity to submit written testimony in support of House Bill 145, which creates a maximum annual percentage rate of thirty-six percent for loans in an amount of $25,000 or less.

AFC is the premier, standards-based trade association representing responsible fintech companies of all sizes and their innovative partner banks. Our mission at AFC is to promote an innovative, transparent, inclusive, and customer-centric financial system by supporting responsible innovation in financial technology (Fintech) and encouraging sound public policy. AFC members are at the forefront of fostering competition in consume finance and pioneering ways to better serve underserved consumer segments and geographies.

AFC believes that the goal of sustainable access to credit should be present in all lending and servicing components, and that innovation can be a driver of fair and responsible access to credit. Innovative fintech platforms can expand access for communities and small businesses that have been traditionally underserved through responsible lending.

We strongly believe that responsible credit, made available to Alaskan consumers is especially important in the current interest rate environment. As evidenced by our consistent advocacy for a 36 percent interestrate cap and our standards for lenders, AFC advocates for responsible credit in a manner that mirrors HB 145’s provisions. Ensuring that Alaskan consumers have access to responsible credit of 36 percent and below will provide your constituents with the credit they need and give them the ability to continue driving the Alaskan economy forward. To that end, AFC supports HB 145’s establishment of a 36 percent interest rate cap for small dollar loans $25,000offered in Alaska.

In closing, the AFC applauds this Committee for taking up this issue in a timely manner and seeking a pragmatic solution for access to credit issues. Thank you for the opportunityto offer our testimony in support of this bill. The AFC avails itself for any questions that may arise now and in the future.

Sincerely,

Elizabeth Gorz

Chief Strategy Officer and Head of Legislative Affairs

American Fintech Council

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