Faith community applauds payday lending reform bill veto
JEFFERSON CITY - Members of faith-based organizations said Thursday Governor Nixon's veto on the payday lending reform bill is a victory for the faith community and the working poor.
The payday lending reform bill would have changed the state's payday loan laws. Right now, borrowers in Missouri can renew a payday loan up to six times, and can face interest rates as high as 75 percent for the term of the loan. Since the typical loan is about two weeks, interest rates total to 1,950 percent annually.
The bill would have ended loan renewals and limited interest rates to 35 percent. This means the ammounting interest rate would be 912 percent annually.
Nixon said the bill wasn't "true reform" and blocked it from passing on Thursday morning.
Barbara Paulus, Leader of the Economic Task Force for Metropolitan Congregations United, said the bill was touted as reform, but was really a sham.
"Basically the legislature gave into the payday lending industry, because they were actually lobbying for this bill," Paulus said.