Nebraska Voters to Put an end to 404% Interest Rates on Payday Loans

On Election Day, Nebraska voters voted to put significant limits on the interest rates payday lenders can charge. …
Nebraska Voters to Put an end to 404% Interest Rates on Payday Loans

On Election Day, Nebraska voters voted to put significant limits on the interest rates payday lenders can charge. 

A 400% interest rate on small-dollar loans is the average across the States. Now that 83% of Nebraska voters have approved Initiative 428, that won’t be the case in this Midwestern state: Payday lending interest rates will soon be capped at 36%. 

Nebraska, in addition to D.C, is the 17th state to implement such a cap. Other states to have pushed such a measure in recent years include Colorado, Ohio, Montana, and South Dakota. 

According to the Nebraskans for Responsible Lending coalition, which helped put the initiative on the ballot, the average interest rate for a payday loan in Nebraska has been 404%.

Also read: Coloradans Vote For Reintroduction of Gray Wolves in West of the Rockies

In South Dakota, before 2016, payday lenders charged up to 574% interest. According to Brookings, the volume of payday alternative loans offered by credit unions grew considerably when the state voted to cap interest rates at 36% in the last US election. 

The Center for Responsible Lending (CRL), in an interview with Market Watch said that:

There is just something wrong with triple digit interest rates and trapping people in cycles of debt.” his transcends political ideology. Everyone should be able to get behind safe, affordable consumer loans that don’t have triple-digit interest rates.

Center for Responsible Lending (CRL)

This transcends political ideology. Everyone should be able to get behind safe, affordable consumer loans that don’t have triple-digit interest rates.

Ashley Harrington (Federal Advocacy Director at the CRL)

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