Owens Offers Bill to Cap Interest on Pay-Day Loans

by scrosby on February 8, 2010

From Kentucky Public Radio’s Tony McVeigh

A Louisville lawmaker wants tighter restrictions on payday lenders in Kentucky, but the industry is fighting back.

Rep. Darryl Owens says payday lenders prey on the poor, and leave many customers struggling with long-term debt. Owens and 19 co-sponsors are offering legislation capping interest on payday loans at 36-percent annually.

“I feel, very strongly, that we can get this done,” says Owens, “It is not going to be easy, but of everybody puts their shoulder to the wheel, we can gets this moving.”

But the industry says legislation approved last year hasn’t been given time to work. It creates a statewide database to track payday loans, to ensure that no person takes out more than two loans with a total limit of 500-dollars.

The industry predicts the database will eliminate up to 30-percent of payday loans in Kentucky.

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