NMiF correspondent Gwyneth Doland is following issues and legislation in the Roundhouse. This week, she is reporting on a proposal to cap interest rates on payday loans at 36 percent.
“I think it’s very much a human rights issue,” Sen. William Soules, D-Las Cruces said Monday. “We are charging people exorbitant interest rates on very small loans. It takes money away from those who can least afford to pay,” he said, adding that the money consumers spend on interest is effectively taken out of the economy.
Industry representatives say they couldn’t afford to makes the loans at lower interest rates because so many people default on their loans. They say limiting the amount of interest they can charge would put them out of business and drive people to borrow money from unregulated sources online.
Read the full story at New Mexico in Depth
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