SENATE DEMOCRATS: CONSUMER PROTECTIONS FOR PAYDAY LENDING MUST REMAIN INTACT

FOR IMMEDIATE RELEASE
February 13, 2015

SENATE DEMOCRATS: CONSUMER PROTECTIONS FOR PAYDAY LENDING MUST REMAIN INTACT

CARSON CITY - Today, Democratic Senators on the Senate Committee on Commerce, Labor, & Energy responded to SB 123, a bill that would weaken consumer protections in the payday lending industry. Specifically, the bill would remove a prohibition on lawsuits by lenders of certain types of payday loans against borrowers. At today’s hearing, a variety of groups, including representatives of some payday lenders, spoke out against the proposed changes. 

“One in five Nevada veterans have used a payday loan, and many continue to struggle to pay them back,” said Senator Pat Spearman, a U.S. Army veteran. “We owe our constituents the best protection the law can provide, not weaker laws that will hurt veterans and all Nevadans.” 

“Today’s testimony showed that SB 123 is fundamentally flawed,” said Senator Mark Manendo. “We’re still recovering the Great Recession, and this is the wrong time to put working families at risk when they’re just getting back on their feet.” 

“This bill raises serious consumer protection concerns,” said Senator Kelvin Atkinson. “If Nevada is going to offer a fair shot for everyone, then we can’t be a state where the laws favor payday lenders over everyday Nevadans.” 

In Nevada, a typical payday loan carries an interest rate of more than 400%. According to a study conducted by UNLV, 1 in 5 (20%) Nevada veterans have used a payday loan, far exceeding the national rate. The Department of Defense considers payday loans to be predatory and a threat to military readiness. According to studies, 75% of payday lending fees are generated by borrowers taking out over 10 loans a year – proving they are not a one-time fix.

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