Legislators in Ohio and other states are continuing to cap payday loans to 36% or lower. The lower interest rates has already forced over 150 payday lenders to close their stores. Politicians in Ohio took away a financial choice that people prefer, and for many, are their only choice.
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The Ohio Ballot Board voted in favor of payday loan companies this week when they voted against interest related language that was to be placed on a ballot. The language would outline what could be charged on a loan, 390% or more. Anyone familiar with how a payday loan works knows that the cash advance is short term, so traditional means of calculating interest such as APR, don’t apply since most loans are paid back in 2 weeks. The panel concluded that allowing the language to be included was prejudicial.