AFSA on Alaska Banking Laws
AFSA’s State Government Affairs team sent a comment letter to the Alaska Senate regarding Senate Bill 39 and banking laws. In the letter, AFSA expresses concern that if SB 39 is passed, it would essentially remove the only accessible and affordable loans that many Alaskans rely on to build credit. Additionally, it would impose unnecessary and harmful restrictions on the lending activities of AFSA members in Alaska. Licensed lenders in Alaska have long played a crucial role in providing fair and reasonably priced loan choices to residents with less-than-ideal credit scores, fulfilling an important need in the state’s credit landscape.
AFSA members also engage in commercial lending in the state, which, although not its primary focus, would face constraints if SB 39 is enacted. Consequently, this legislation would hinder these lenders, who comply with Alaska’s regulations, from functioning. This bill would have adverse repercussions on the communities it aims to assist, particularly impacting lower and moderate-income families, underserved groups, and minority communities.
The letter emphasizes the impact of SB 39, which would essentially forbid credit insurance and other optional protective products that are vital for bolstering consumer financial stability and shielding against economic downturns. This limitation is unjustified, as AFSA members’ insurance and other non-loan financial services are entirely voluntary for consumers, and loan terms are provided independently of whether credit insurance is selected. AFSA’s letter also underscores the dangers of deviating from the TILA APR standards. Departing from the established industry norms governed by TILA would undermine its core consumer protections and severely limit credit accessibility in Alaska.
This letter, along with SGA’s other recent letters, can be found on the direct advocacy section of AFSA’s website.
February 20th, 2025
