Our Families Deserve Better than Triple Digit Interest Rates
Every day, thousands of families in Missouri struggle to stretch their wages across mounting bills. Times are tough, and within our communities we are finding that too many families lack the income to meet their basic needs. In these difficult times, many seek small dollar credit, like payday and car title loans, that charge upwards of 400% interest and can spiral hard-working families deeply into debt.
We know from the teachings of our diverse faith traditions that triple digit interest rates are unfair.
For thirteen years, CCO has been fighting to reform small dollar lending in Missouri, a state where the legal interest rate cap on payday loans is an appalling 1,950% APR. From our research, we know that the average payday borrower repays $710 for a $300 loan, and that families in Greater Kansas City pay a whopping $26 million in payday loan interest fees each year.
We’ve worked hard this past year to create strong laws that prevent predatory lending. Unfortunately, the only payday regulation bill that has been voted out of committee, HB 656 sponsored by Rep. Ellen Brandom, is NOT real reform.
HB 656 bill would allow lenders to charge up to 1,500% APR, and it would leave millions of Missouri families trapped in the payday debt spiral.
CCO believes that in order for lending to build assets in our communities, lending products in Missouri must abide by a
fair interest rate. Without a strong interest rate cap of at least 36% on small dollar loans, our families will continue to be abused by predatory lending, and our communities will continue to reel from the wealth drain.
Communities Creating Opportunity, an affiliate of the PICO National Network, is non-partisan and not aligned explicitly or implicitly with any candidate or party. We do not endorse or support candidates for office.