Ohio Senate Passes Strict Lending Legislation, Prepares To Punch Payday Lenders In The Face

The ass-kicking, face-punching anti-payday lending legislation that we’ve been keeping an eye on in Ohio has passed the Senate. The Columbus Dispatch says:

House Bill 545 would slash the current interest rates charged by payday lenders to 28 percent, down from 391 percent, prohibit loans terms of less than 31 days, and limit borrowers to four loans per year. It would ban Internet payday lending, and it also attempts to encourage lenders to get into the small-loan business.

Payday lenders say the bill would quickly put their 1,600 Ohio stores out of business and 6,000 employees out of work. One industry lobbyist estimated that fewer than 150 stores would remain in Ohio, as some also offer other services, such as pawnshops or check cashing.

“This will, without a doubt, close the industry,” said Tiffany Verderosa, a Toledo-area manager for Fast Cash of America.

It seems that Ohio has finally had enough of the rapidly expanding payday lending industry: ““I think everybody said there is just no way to redeem this product. It’s fundamentally flawed, and it all too often traps people in a cycle of debt they can’t get out of,” Bill Faith, a leader of the Ohio Coalition for Responsible Lending, told the Dispatch. In the past 11 years, payday lending in Ohio has grown from a mere 106 stores to more than 1,600 today.

Senate approves tough payday-lending bill [Columbus Dispatch] (Thanks, Andrew!)
(Photo: eyetwist )