This article gives a good update on the status of legislation in Ohio. Key passage:
It’s the Senate committee’s third hearing on the issue, with a fourth hearing on the schedule for Wednesday afternoon but no testimony scheduled.
The House bill included not only the interest cap but also a limit of four payday loans per year per customer.
Phyllis Riccadonna, who has operated America Check Exchange locally since 1997, said there are other solutions that weren’t included.
“I’ve been in this business since 1997. I opened the first payday loan shop in the entire Ohio Valley,” Riccadonna said. “The 28 percent cap would put us out of business. There is no ifs, ands or buts about it. It amounts to a charge of about a dollar per loan.”
State Treasurer Richard Cordray said in a recent interview that the current loan rates charged by the payday lenders in Ohio amount to about 391 percent annually, but Riccadonna said a better solution would be a return to tighter caps on loan amounts, not interest.
Reasonable regulation would be for the state to require payday lenders to hand their customers a fact sheet, authored by the state, warning customers of the pitfalls of using payday loans irresponsibly. The customer would be required to sign at the bottom affirming that he had received, read, and understood the fact sheet – and maybe even be required to answer a few multiple-choice questions as well, so it would be assured that every payday loan customer understood the facts of the matter and knew what he was getting himself into.
That’s a non-authoritarian solution to the problem which doesn’t terminate freedom of choice for the consumer and freedom of commerce for the lender.
The problem isn’t the interest cap, the problem is allowing customers to roll their loan over and over and over again. The solution would be to not only limit the number of loans, but the number of times you are allowed to roll over the loan.
the trouble is Government cant control personal spending habits and for it to step in there is dangerous grounds