NewsCovering Colorado


ELECTION RESULTS: Voters approve Prop 111 – Payday loan cap

Posted at 10:36 PM, Nov 06, 2018
and last updated 2018-11-16 12:21:13-05

COLORADO – The Associated Press has said Colorado voters have approved Proposition 111, which reduces the interest rate on payday loans to 36 percent.  It also eliminates all other finance charges and fees associated with payday lending.

Proposition 111 – Payday Loans Cap

Yes 1,859,517 77%
No 547,608 23%


Currently in Colorado, when anyone wants to get a payday loan- they could face interest rates of about 200 percent on the high end. 15 states and the District of Columbia have enacted similar laws to cap payday loan interest rates.

Argument For

1) Coloradans are paying too much to borrow small amounts of money from payday lenders. The APR for
these loans can exceed 180 percent. Some consumers borrow money to pay off other payday loans,
which leads to a cycle of debt. Because the measure reduces the high cost of payday loans, consumers
may be better able to repay their loans and avoid further financial stress.

Argument Against

1) This measure may eliminate the payday lending business in Colorado. Payday loans provide options for
consumers who may not qualify for other types of credit. With limited or no access to these loans,
consumers may pay higher costs to other creditors for late payment, bounced check, overdraft, or utility
disconnect fees, or turn to unregulated lenders for higher-cost loans. This measure is unnecessary
because the state legislature passed reforms in 2010 that led to reduced loan costs and fewer defaults,
while ensuring that consumers have access to a well-regulated source of short-term credit.

Estimate of Fiscal Impact

State revenue and spending. If Proposition 111 results in payday lenders choosing not to renew their
licenses, there will be a reduction in fee revenue to the Department of Law.