A controversial lending bill that narrowly passed out of the Senate is on its way to the House floor with a few changes. The amendments approved in committee Tuesday were not released until an hour prior to the meeting.
The House Financial Institutions Committee took no public comment on the bill, which changes rules for high-interest, short-term loans.
One of the amendments lowers the interest rate cap for loans of less than $3,000 to meet the state’s 72% rule. And while the cap was lowered to 167% on loans requiring no collateral, that number is still well above what’s outlined in existing law.
READ MORE: Lawmakers Work To Expand Payday Lending Options Some Say Are Predatory
House sponsor Rep. Matt Lehman (R-Berne) contends these new loan options are needed.
“All this bill does is now to create a middle product,” says Lehman. “To try to drive people out of that, if they feel payday lending is their only option, this moves them away from that.”
Democrats and consumer advocates had hoped to lower the state’s interest cap to 36%, but that effort failed earlier this session.
Rep. Carey Hamilton (D-Indianapolis) raised concerns she has with voting in favor of the bill after hearing testimony from advocates opposed to the bill last month.
“I truly believe based on what I’ve learned from the organizations that have weighed in on this for a couple of years that moving forward on this bill will do more harm than good,” she says.
The House committee voted along party lines, 7-3.
