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Campaign Contributions Hinder Payday Loan Reform

Aug 9, 2013

Payday lenders targeted by Ohio legislation that banned short-term, high-cost loans five years ago are skirting the crackdown by offering high-interest loans under other laws.

Some of the hundreds of storefront lending operations closed but others have exploited loopholes and provided loans under laws not written for such businesses. Payday lenders say their services are needed. Critics contend they are predatory lenders who trap the poor in debt. State lawmakers have been quiet on the issue in the three years since a bill to limit payday lender fees died in the Republican-controlled Senate. The industry has contributed 465 thousand dollars to legislative campaign accounts since 2009.