Fees for service - Deferred presentment service transaction procedures - Penalty
N.D. Cent. Code § 13-08-12
in effect13-08-12. Fees for service - Deferred presentment service transaction procedures -
Penalty.
1. Before disbursing funds under a deferred presentment service transaction, a licensee
shall provide to the customer a clear and conspicuous printed notice indicating:
a. That a deferred presentment service transaction is not intended to meet
long-term financial needs.
b. That the customer should use a deferred presentment service transaction only to
meet short-term cash needs.
c. That the customer will be required to pay additional fees if the deferred
presentment service transaction is renewed rather than paid in full when due. If
the transaction is renewed, any amount paid in excess of the fee applies to the
payoff amount.
d. A schedule of fees charged for deferred presentment service.
e. Any information required under federal law.
f. No property, titles to any property, or mortgages may be received or held directly
or indirectly by the licensee as a condition of a deferred presentment service
transaction or as a method of collection on a defaulted deferred presentment
service transaction without proper civil process.
2. A licensee may charge a fee for the deferred presentment service, not to exceed
twenty percent of the amount paid to the customer by the licensee. This fee may not
be deemed interest for any purpose of law. No other fee or charge may be charged for
the deferred presentment service, except that a fee, not to exceed the cost to the
licensee, may be charged for registering a transaction on a database administered or
authorized by the commissioner. No property, titles to any property, or mortgages may
be received or held directly or indirectly by the licensee as a condition of a deferred
presentment service transaction or as a method of collection on a defaulted deferred
presentment service transaction without proper civil process.
3. A licensee may not disburse more than five hundred dollars to the customer in a
deferred presentment service transaction.
4. A licensee may not engage in a deferred presentment service transaction with a
customer who has an aggregate value of all outstanding obligations from any one
customer exceeding six hundred dollars which is payable to the same or any other
licensee. A licensee may not enter a new deferred presentment service transaction
with a customer within three business days of that customer's completion of a previous
deferred presentment service transaction. A licensee may rely on a written or
electronic representation of a customer regarding the existence of any outstanding
obligations for deferred presentment held by a licensee other than the licensee
receiving the representation until the database provided for under this subsection is in
operation, and after that time may not rely on a customer's representation but must
verify the fact using the database. However, if a licensee has multiple locations, that
licensee may not rely on the representation of a customer regarding the existence of
any outstanding obligation for deferred presentment held by that licensee, or one of
the licensee's multiple locations, unless the licensee and the licensee's multiple
locations use a point of sale registry or some other accounting system to attempt to
prevent violations of this subsection. The commissioner shall administer or authorize
the development of a database in which each transaction must be recorded for the
purpose of preventing violations of this section. The commissioner shall adopt rules
governing the creation, structure, and use of the database.
5. Before a licensee may negotiate or present a check for payment, the check must be
endorsed with the actual name under which the licensee is doing business.
6. Each deferred presentment service transaction, including a renewal, must be
documented by a written agreement signed or similarly authenticated by the customer.
The original agreement must contain the name of the licensee; the transaction date;
the amount of the obligation; a statement of the total amount of fees charged,
expressed as a dollar amount and as an annual percentage rate; the name and
signature of the individual who signs the agreement on behalf of the licensee; the
name and address of the check maker; the transaction number assigned by the
database; the date of negotiation of the check; the signature of the check maker; a
statement that a licensee may not renew a transaction more than once; a statement
that the renewal fee may not exceed twenty percent of the amount being renewed; a
statement that the maximum term of the transaction, including the renewal, may not
exceed sixty calendar days; a statement that the term of the renewal period may not
be less than fifteen calendar days; and a statement containing the right of rescission
printed immediately above the signature line of the written agreement in a minimum of
ten-point font and providing a space for the check maker to initial that the notice to the
right of rescission was received. The original agreement may not include a hold
harmless clause; a confession of judgment clause; any assignment of or order for
payment of wages or other compensation for services; a provision in which the check
maker agrees not to assert any claim or defense arising out of the agreement; a
waiver of any provision of this chapter; any representation from the check maker as to
the sufficiency of funds regarding any past deferred presentment service transactions;
or any statement regarding criminal prosecution with respect to the agreement. A
renewal agreement must be contained in a separate section, as part of the original
written agreement or in other form as approved by the commissioner. The renewal
agreement must restate the original transaction date, the renewal transaction date, the
amount of the check paid to the check maker, the fee charged in dollars, and the
maturity date. The agreement must authorize the licensee to defer presentment or
negotiation of the check, or electronic debit of the customer's account, until a specified
date. The maker of a check may redeem the check from the licensee at any time
before the negotiation or presentment of the check by making payment to the licensee.
A customer agreeing to an electronic deferred presentment service transaction may
repay the obligation at any time before the agreed-upon date. A customer may rescind
any transaction by the close of the business day following the day on which the
customer receives payment from the licensee at no cost. If a customer agreeing to an
electronic deferred presentment service transaction rescinds the transaction, the
licensee must facilitate the repayment of the funds through the same electronic means
the licensee used to deliver the funds to the customer.
7. If a check or electronic debit is returned to the licensee from a payer financial
institution due to insufficient funds, closed account, or a stop payment order, the
licensee has the right to all civil remedies available to collect the obligation. The
licensee may contract for and collect a returned check or electronic debit charge not to
exceed the collection fees and costs authorized in subdivision c of subsection 2 of
section 6-08-16. No other fee or charge may be collected as a result of a returned
check or electronic debit or as a result of default by the customer in timely payment to
the licensee.
8. A customer who has authority to make a check or authorize an electronic debit and
enters a deferred presentment service agreement is not subject to a criminal penalty
relating to the check, electronic debit, or the deferred presentment service agreement
unless the customer's account was closed on the original date of the transaction. At
the time of entering a transaction involving a written check, a licensee shall verify that
the account on which the check is written is open. A licensee may not pursue or
threaten to pursue criminal penalties against a customer for criminal penalties
prohibited by this subsection.
9. A licensee may not engage in unfair or deceptive acts, practices, or advertising in the
conduct of a deferred presentment service business.
10. The amount paid to the customer by the licensee in a deferred presentment service
transaction must be paid in the form of cash, check, or an electronic credit to the
customer's account.
11. Each licensee must conspicuously post in the licensee's licensed location a notice of
the fees imposed for the deferred presentment service. A licensee that engages in a
deferred presentment service transaction via the internet shall require its customers to
acknowledge the fees imposed using a click-through or other method that prevents
customers from completing the transaction without reviewing the licensee's fees.
12. Except as provided under subsection 13, a licensee may not renew a deferred
presentment service transaction more than once. A licensee's renewal fee may not
exceed twenty percent of the amount being renewed. The renewal fee must be paid in
cash, money order, or cashier's check. The total period of deferral, including the initial
deferral and one renewal, may not exceed sixty days. An individual renewal period
may not be less than fifteen days. After sixty days the renewed deferred presentment
service transaction must be paid off in cash, money order, electronic payment, or
cashier's check by the customer or, if a check is used, the check must be deposited by
the licensee.
13. A licensee may enter a workout agreement with the borrower if the borrower believes
financial hardship prevents the borrower from paying off the deferred presentment
service transaction at the end of the original agreement or following any renewal. The
workout agreement must outline the repayment terms in writing and must require
weekly, biweekly, or monthly even installments not to exceed twelve months. An
additional interest or fee may not be charged as part of this workout, the deferred
presentment service provider shall continue to report the transaction as an outstanding
deferred presentment service transaction on any database administered by the
commissioner, and entering a workout agreement is voluntary on the part of the
deferred presentment service provider and the borrower.
14. A licensee may not renew, repay, refinance, or consolidate a deferred presentment
service transaction with the proceeds of another deferred presentment service
transaction with that licensee by the same maker or customer. It is presumed that a
deferred presentment service transaction initiated within three business days before
completion of a deferred presentment service transaction is a violation of this
subsection.
15. A licensee may not conduct another business, other than a bona fide pawnbroking
business, within the same office, suite, room, or place of business at which the
licensee engages in deferred presentment service transactions unless the
commissioner provides written authorization after a determination the other business is
not contrary to the best interests of consumers.
16. A licensee shall provide a notice in a prominent place on each deferred presentment
service agreement in no less than ten-point type in substantially the following form:
State law prohibits this business from allowing customers to have outstanding at
any one time, deferred presentment service transactions totaling more than six
hundred dollars.
17. A licensee or any agent of a licensee who willfully violates this section is guilty of a
class A misdemeanor.
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://ndlegis.gov/cencode/t13c08.pdf#nameddest=13-08-12Fetched: 10/16/2026