Lawmakers Debate New Kind Of Consumer Loan In Arizona
This week, a state House committee voted to allow a new type of consumer loan into Arizona.
Voters voted eight years ago to kill off the payday loan industry, and current state law generally allows interest rates up to 36 percent a year. Senate Bill 1316 would allow lenders to charge up to 17 percent a month on loans up to $2,500 for up to two years.
State Representative J.D. Mesnard said it’s about consumer choice.
"When we prohibit people from making decisions that's exactly what we're saying, that we know better than they do. I resist that. Does it mean that, given a choice, that people will make bad decisions sometimes? Yes, it does. But you don't remove the choice from everybody because of those who will make bad decisions."
The House Ways and Means Committee has approved the bill, which now awaits debate by the full chamber.
One person opposed to the proposal is Catherine Scrivano, a financial planner with Casco Financial Group in Phoenix. She spoke about the issue.