20 Jan Mississippi House of Representatives protects predatory lending
Statement from Paheadra Robinson, Consumer Protection Director, regarding the extension of payday lending operations in Mississippi
(Jackson, Miss.) – This week, the Mississippi House of Representatives voted to protect industry profits instead of protecting hardworking consumers across Mississippi. House Bill 455 provides no real protection for consumers who find themselves in hard times and in need of small dollar loans. We are disappointed that Rep. George Flaggs consulted with the payday lending industry, but not with consumer advocates, before introducing this legislation.
At the Mississippi Center for Justice, we work with Mississippians every day who have encountered a financial hardship and who have turned to a payday lender seeking relief, only to find themselves caught in a trap that ends up costing them more money, more time, and in some cases, the very livelihoods and homes they were trying to protect. We believe that triple-digit interest rates are too high for the working class people of our state. We believe that school teachers, low-wage state workers, police officers and others deserve at least 90 days to repay these small dollar loans. We believe that the creation of a database that allows consumer advocates access to real data regarding the nature of the payday loan industry is essential to creating a fair lending environment in Mississippi.
While these measures do much to help Mississippians, they are not far-reaching when we consider what other states are doing. Arkansas, Georgia and Florida are among numerous states whose elected officials chose to protect the people they serve over the profits of the payday lending industry. These states have enacted measures similar to the ones we seek in Mississippi: a 36% rate cap, an extended repayment period that allows for installment payments and a database to track lending practices.
As the Senate Business and Financial Institutions Committee considers this issue during a hearing today, we hope they will correct the egregious wrong of the Mississippi House and support a bill that provides true consumer protections to Mississippi, not to an industry whose profits come at too high a cost to Mississippi families and communities.