36% Payday Loan Rate Cap in Nebraska Target of New Petition Campaign | Silver
Congress passed a 36% cap on active-duty military personnel after the Defense Department reported payday loans were negatively impacting military readiness and morale.
“It’s great that our soldiers are protected. We need the same protection for veterans, teachers, first responders and other Nebraskans who work hard to provide for their families and do not deserve to be subjected to these exorbitant tariffs, ”said Mick Wagoner. , director of the Veterans Legal Support Network and member of the voting committee.
But Brad Hill of the Nebraska Financial Services Association, which represents the state’s payday lenders, said the proposal “would spell the end” for payday lenders and create hardship for their clients. He said the industry is already under strict regulation in Nebraska.
Transactions are limited to $ 500 each and people can only have two loans at a time. He said lenders typically charge a 15% fee, rather than traditional interest. This means that in exchange for a customer writing a check for $ 100 dated two weeks in the future, the lender would give that person $ 85 in cash.
“We give credit to a part of the public who cannot get credit from the banks,” Hill said.
Julia Tse, of Voices for Children, said coalition members decided to pursue an initiative petition after making numerous unsuccessful attempts to get legislation to cap interest rates in Nebraska. A payday loan law passed in 2018 has been watered down significantly from the original proposal.