Payday lenders and high-cost installment lenders offer fast cash loans that do far more harm than good, adding to rather than alleviating financial distress. As a growing number of states have curtailed high-cost lending, experience shows that people are better off and find better options.
The American public, on a bipartisan basis, strongly supports capping interest rates at 36% or lower. Voters in several states have overwhelmingly supported rate caps whenever given a chance to vote on an initiative. Polling has also consistently shown strong, bipartisan support for a 36% rate cap.
But the question often arises: Once a state limits interest rates, what is the impact on consumers?