In his latest rant against the payday lending industry in Ohio, Thomas Suddes argues payday lenders are operating through a loophole. The fact is, while dozens of lenders closed their doors upon passage of the annual rate cap in Ohio, other lenders, instead of laying off employees and turning customers away, began offering different credit products and services- all well within the Ohio lending laws.

In fact, during the legislative debate concerning payday lending, lenders were urged to apply for licenses to operate under Ohio’s Small Loan or Mortgage Loan Act and encouraged to come up with new credit products to service the growing consumer demand for short-term, small-dollar loans. This is exactly what lenders are doing- operating under the Small Loan or the Mortgage Loan Act, both which have been part of Ohio law for thirty years.