Payday Loan Interest Rate Cap Petitions Now Circulating
There are two petitions in South Dakota that aim to cap the amount of interest that payday lenders can charge. According to one study payday lenders charge average rates of 574 percent in South Dakota. But, proponents of a 36 percent cap, call a second interest rate campaign a fake that aims to confuse voters.
South Dakota is one of few states in the nation that doesn’t cap the interest rates on payday loans. Multiple attempts in the state legislature to put a top end on payday loan rates have failed. Steve Hildebrand says it’s time voters had a say.
“Within the general public there is great distain for the very high interest rates payday lenders charge principally on poor people who walk into their doors because they’re desperate for some immediate money,” says Hildebrand.
Hildebrand is co-chair of the bi-partisan group South Dakotans for Responsible Lending that aims to cap interest rates at 36-percent. He’s confident voters will see the issue on the 2016 ballot.
“We feel good about where we’re at. We feel confident we’re going to meet our goals. We’ve got a lot of work ahead of us but we will get there,” says Hildebrand.
There is a second petition circulating in the state that proponents say caps interest rates at 18-percent. Hildebrand calls the petition a decoy funded by the payday loan industry in an attempt to trick voters. The petition would only provide an 18 percent cap on verbal loan agreements, not those in writing. The backers of the 18-percent cap have refused an interview request following multiple attempts to reach them. Lisa Furlong is the petition organizer. She pointed instead to an interview completed by Dakota War College which is an internet blog. She claims the petition is thoughtful and real. Furlong did not answer questions about the exact wording in the proposed cap or who is behind the petition drive.