Lawmakers seek limits on payday loan industry
MONTGOMERY, Ala. (AP) — Payday lending customers would have longer to repay their loans under a proposal supporters hope will win approval after years of stalled reform efforts.
Advocacy groups on Thursday urged lawmakers to support the measure they said will give borrowers a fighting chance to repay the loans.
Proposed legislation would give borrowers 30 days to repay a loan instead of as little as 10 days.
Supporters of the bill said the loans become debt traps with annualized interest rates of up to 456%.
Industry representatives have maintained that the loans provide a needed financial help.
Alabama Arise and the Appleseed Center, groups that support reforms, said a state database shows more than 200,000 Alabamians took payday loans in one year. Most of those people took out multiple loans.