Hamilton addresses responsible lending at coalition press conference

Today, State Rep. Carey Hamilton (D-Indianapolis) spoke at a press conference hosted by Hoosiers for Responsible Lending Coalition about her legislation that would crack down on predatory lending in Indiana. 

Hamilton’s House Bill 1171 would cap payday loans at an annual rate of 36%, which is the recommended national standard to break the cycle of debt for households that turn to payday loans to make ends meet. Currently, 18 other states have passed legislation to cap payday loans at 36%.

“The current interest rate on a $500 14-day payday loan can be as high as 391%. Let me repeat that: 391%,” Hamilton said. “Charging struggling Hoosiers an interest rate of nearly 400% is simply wrong.

“Aside from the moral question of predatory lending, the economic drain on our state is substantial. In 2021 alone, according to a recent study from the Indiana Community Action Poverty Institute, Hoosier payday borrowers could have saved more than $26 million if interest was capped at 36%. This $26 million is not only a direct loss of spending power but has a compounding economic cost in human capital. For families who end up in a debt trap, they may lose transportation to work if their vehicle is repossessed, or the academic performance of their children may decrease due to the stress of financial hardship at home. 

“It is time to end the stranglehold that predatory lenders have on Indiana. I look forward to working together with my fellow legislators and advocates this session to stand up for Hoosiers and put an end to predatory loans.”