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SDPB Radio Coverage of the South Dakota Legislature. See all coverage and find links to audio and video streams live from the Capitol at

Measure May Circumvent Payday Lending Cap Vote

In November voters in South Dakota will decide on a measure that caps the amount of interest a payday lender can charge at 36 percent.    

But a bill lawmakers are considering in Pierre might override that effort.   Critics of House Bill 1161 say it negates the effort to cap interest rates.   

House Minority Leader Spencer Hawley says the legislation is backed by the payday lending industry.

“The one section says that if the initiated measure goes through, that basically it doesn’t apply to this bill. So, it downplays what the initiated measure is. Whether you’re for payday lenders or against payday lenders the timing of this bill just isn’t good and I wasn’t able to support that in the past,” says Hawley.

But proponents say the measure adds regulations and oversight to payday lenders. They say it also adds new line of credit for consumers who have limited access to capital.  

Those who testified in favor of the bill include owners and employees of payday loan businesses, and lobbyists for the payday loan industry.    

Those who testified against the bill include the AARP, The Presentation Sisters of Aberdeen, and the National Association of Social Workers.  Opponents say the measure weakens consumer protections and thwarts voter choice in November.

Lawmakers on the House State Affairs Committee passed the measure by a vote of 8 to 5.  House Bill 1161 is headed next for the House floor.