Advocates set to press for cutting 260 percent APR on payday loans
Members of the coalition pushing for cutting the up to 260 percent annual percentage rate interest on payday loans plan to lobby lawmakers at the Statehouse on Wednesday.
Bills (H-7257 and S-2307) to lower the APR to 36 percent remain in the chambers’ respective Corporations Committees, and talks about the legislation is ongoing.
The Reverend Donald Anderson, part of the coalition calling for change, offered this preview of the group’s lobbying effort:
“The big thing that we want to talk to people about is, 260 percent interest is just wrong. It’s not helpful. The industry actually targets people and loans money to people who can’t afford to borrow the money.”
Payday lenders defend their service as useful. And it doesn’t hurt to have as your lobbyist someone like former Speaker William Murphy. The coalition pushing for change also has its own well-connected lobbyist, former Senate Majority Leader Daniel Connors.
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Will Speaker Fox and President Paiva-Weed further tarnish their legacies by siding with these predatory lenders and Bill “$50,000 and I’ll do anything” Murphy, or will they actually do the right thing and get this bill passed?
This would put all pay-day lendors out of business which would be fine if there were alternatives to help people short on cash at the time. However, there isn’t so all this bill does is push the problem elsewhere.
“This would put all pay-day lendors out of business”
If so, so be it.
John, Why are payday lenders able to stay in business in other states with the 36 percent cap on APR?
What states have that apr? The purpose of the low apr is to put them out business. Apparently some pay-day lenders partnered with nationally chartered banks to get around the apr laws in some states. At such a low apr, a payday lending place would get less then $1.50 on a typical $200 payday loan. You would need a substantial amount of loans or other products to survive. I’m by no means agreeing with pay day lending but it’s fair to ask what alternatives there are for that sector.