A BILL TO BE ENTITLED
AN ACT to create the unbanked and underbanked consumers study commission.
Whereas, there is a substantial population of North Carolina consumers that do not have access to traditional sources of consumer credit or financial services; and
Whereas, consumers that do not have or maintain traditional bank accounts are considered "unbanked"; and
Whereas, consumers that have impaired or inadequate credit files are considered financially "underbanked"; and 
Whereas, estimates indicate that as many as three million North Carolina consumers are considered to be unbanked or underbanked; and
Whereas, this constitutes approximately one out of every three adult North Carolinians; and 
Whereas, financial products and financial companies serving these consumers, and laws governing both those transactions and the practices of those companies have evolved substantially in the last 10 years; and
Whereas, the economic development potential of North Carolina and its communities is limited by the large number of unbanked and underbanked consumers; and
Whereas, the access to traditional installment credit, secured and unsecured, as well as mainstream financial services is a key enabler to wealth for all North Carolinians; and
Whereas, the General Assembly has not had a comprehensive review of the State's various lending laws and whether they foster availability of responsible personal installment lending, utilize sources of financial education, or leverage the favorable changes that have occurred in the national marketplace in products, business practices, credit information, and operations technology; Now, therefore,
The General Assembly of North Carolina enacts:
SECTION 1.  Commission Created. – The Unbanked and Underbanked Consumers Study Commission is created.
SECTION 2.(a)  Membership. – The Commission shall consist of 14 members appointed as follows:
(1)	Five members of the House of Representatives appointed by the Speaker of the House.
(2)	Five members of the Senate appointed by the President Pro Tempore of the Senate.
(3)	One member associated with a consumer advocacy corporation specializing in unsecured credit issues appointed by the Speaker of the House.
(4)	One member associated with a consumer advocacy organization specializing in real estate secured credit issue appointed by the President Pro Tempore of the Senate.
(5)	One member associated with a State chartered credit corporation specializing in unsecured credit appointed by the Speaker of the House.
(6)	One member associated with a State chartered credit corporation specializing in real estate secured credit appointed by the President Pro Tempore of the Senate.
SECTION 2.(b)  Vacancies. – A vacancy in the Commission or as chair of the Commission resulting from the resignation of a member or otherwise shall be filled in the same manner in which the original appointment was made.
SECTION 3.  Duties of Commission. – The Unbanked and Underbanked Consumers Study Commission shall study the following matters related to access to credit by consumers who are considered unbanked or underbanked:
(1)	The respective academic and economic studies, consumer protection laws, and corporate best practices for consumer installment finance developed over the last 10 years in this State, neighboring states, and across the country.
(2)	The potential business models and regulatory economic incentives that could serve to transition and graduate consumers from sub‑prime to prime credit scores resulting in increased chances that consumers might accumulate wealth.
(3)	Whether lending processes are understandable, fair, and efficient and what would constitute optimum disclosures to consumers so that consumers can understand and make reasoned decisions with regards to the products being offered.
(4)	The economic impact of raising credit scores and requiring wider reporting and creditor consideration of payments for alternative credit‑like accounts, including rent and utilities to major credit bureaus.
(5)	The impact and availability of financial education or incentives to raise personal financial literacy, and personal credit and financial counseling by companies providing customer financial services.
(6)	Whether regulation of financial services is best done on the basis of lender principles and practices or by price, how risk versus reward is determined, whether proper products will be available for consumer needs without economic reward for risk and service cost, and what products or services are not available, and does the lack of these products and services disadvantage consumers.
SECTION 4.  Report. – The Commission may make an interim report to the 2008 Regular Session of the 2007 General Assembly.  Prior to the convening of the 2009 General Assembly, the Commission shall submit a final report of its findings and recommendations, including legislative and funding recommendations, to the 2009 General Assembly. The Commission shall terminate upon filing its final report.
SECTION 5.  Expenses of Members. – Members of the Commission shall receive per diem, subsistence, and travel allowances in accordance with G.S. 120‑3.1, 138‑5, or 138‑6, as appropriate.
SECTION 6.  Chair; Meetings. – The President Pro Tempore of the Senate and the Speaker of the House of Representatives shall each designate one member to serve as cochair of the Commission. The cochairs shall call the initial meeting of the Commission.  The Commission shall subsequently meet upon such notice and in such manner as its members determine.  A majority of the members of the Commission shall constitute a quorum. The Commission may meet in the Legislative Building or the Legislative Office Building upon the approval of the Legislative Services Commission.
SECTION 7.  Staff. – Upon the prior approval of the Legislative Services Commission, the Legislative Services Officer may assign professional and clerical staff and other services and supplies, as needed for the Commission to carry out its duties in an effective manner.
SECTION 8.  Of the funds appropriated to the General Assembly, the Legislative Services Commission shall allocate funds for the expenses of the Commission established by this act.
SECTION 9.  This act becomes effective July 1, 2007.