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Payday loan interest rate cap on November ballot

Posted at 6:41 PM, Sep 18, 2018
and last updated 2018-09-18 21:08:34-04

COLORADO- Currently in Colorado, when anyone wants to get a payday loan- they could face interest rates of about 200 percent on the high end.

‘Being caught up in something like this is a continual thing and I almost want to say perpetual because the loan lasts for such a long time,’ said Frank Lytle, the NAACP State Economic Justice Co Chair and a supporter of Proposition 111.

Which is why the group organizing this ballot initiative wants to cap interest rates at 36 percent.

15 states and the District of Columbia have enacted similar laws.

‘You’re taking advantage of people, it should be up front you know for a reasonable payment,’ said Lytle.

There’s not a registered opposition for the question in Colorado, but on the federal level there are lobbyists working with payday lender groups.

This November, a ballot question aims to cap payday loan interest rates at 36 percent.

According to the Center for Responsive Politics, many of these payday lenders contribute millions to political action committees and individual politicians.

Still, supporters of the measure argue that the payday loan system is predatory as it takes advantage of people who need financial assistance.

‘Obviously people that need money, they’re probably going to need it month after month,’ said Lytle.

With high interest rates, it can make the repayment a challenge as recipients try to make the money with the interest accumulating quickly.