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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2022

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A N   A C T

RELATING TO COMMERCIAL LAW -- GENERAL REGULATORY PROVISIONS --

CREDIT CARD LENDING

     Introduced By: Representatives Barros, Solomon, Kennedy, and Alzate

     Date Introduced: February 11, 2022

     Referred To: House Corporations

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 6-26.1-1 of the General Laws in Chapter 6-26.1 entitled "Credit Card

Lending" is hereby amended to read as follows:

     6-26.1-1. Definitions.

     For purposes of this chapter, the following definitions shall apply:

     (1) "ACH", also known as the Automated Clearing House Network, means the electronic

funds-transfer system comprised of a network of associated institutions that process computer-

based electronic financial transactions between originating and receiving depository financial

institutions. ACH in the United States is governed by NACHA, the former National Automated

Clearing House Association.

     (1)(2) "Credit card device" includes any means of making a credit card transaction

available to a borrower pursuant to a credit card plan, including, but not limited to, a card, draft or

check, identification code, other means of identification, or other credit device or code, whether

made directly or indirectly by means of telephone, point of sale terminal, automated teller machine,

computer or other electronic or other communication or device, or through the mail.

     (2)(3) "Credit card lender" or "lender" means any entity that is a lending institution as

defined by § 19-9-1, or licensee as defined by § 19-14-1, that offers or extends credit in the form

of a credit card transaction.

     (3)(4) "Credit card transaction" means any loan or extension of credit made pursuant to a

credit card plan. Without limitation of the foregoing, a credit card transaction may be extended

under a credit card plan by a credit card lender's acquisition of obligations arising out of the

honoring by a merchant or other third-party; a credit card lender or other financial institution

(whether chartered or organized under the laws of this or any other state, the District of Columbia,

the United States or any district, territory or possession of the United States, or any foreign country);

or a government or governmental subdivision or agency of a credit card device.

     (4)(5) "Credit card plan" or "plan" means any arrangement or plan between a borrower and

a credit card lender or issuer, including, without limitation, lines of credit directly between a

borrower and a credit card lender or issuer, for open-end, revolving extensions of credit made

available through a credit card device or other means of settlement between the credit card lender

or issuer and the merchant, such as ACH or electronic-only credit card devices, provided, however,

said "credit card plan" or "plan" does not include an extension of credit the repayment of which is

secured by real property.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO COMMERCIAL LAW -- GENERAL REGULATORY PROVISIONS --

CREDIT CARD LENDING

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     This act would add a definition for the automated clearing house network and would

modernize the Rhode Island credit card lending statute by amending the definition of "credit card

plan" to keep up with new technology and online purchasing and expressly allow merchants to

continue to assist consumers with digital payment options.

     This act would take effect upon passage.

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