South Dakota Division of Banking Responds to AFSA Request for Clarification on Initiated Measure 21 December 8, 2016 AFSA Staff The South Dakota Division of Banking responded to AFSA’s November 16 comment requesting clarification on issues related to the application of Initiated Measure 21. AFSA’s comment asked that the Division confirm whether the measure’s rate cap would apply to retail installment contracts and asked that the state clarify what ancillary products and other fees or charges must be included, as well as the method of calculation of the 36 percent all-in rate cap. In its response, the Division stated that the rate cap does apply to retail installment contracts because financial institutions that service, acquire, or purchase retail installment contracts are required to hold a money lender license. Additionally, the Division provided a series of fees and ancillary products that would be required to be included in the finance charge under certain circumstances. The Division did not provide further clarification on the method of calculation for the annual rate. Initiated Measure 21 was approved by South Dakota voters on November 8 and became effective November 16, following the Secretary of State’s official canvas. AFSA will keep members apprised of any response from the state clarifying the impact of the Measure.