The payday lending industry might be entirely destroyed while the credit card industry would be significantly altered by a 15 percent rate cap.

The payday lending industry might be entirely destroyed while the credit card industry would be significantly altered by a 15 percent rate cap.

The master plan would ban pay day loans

“Payday” loans are essentially short-term loans (the concept is you’re fronted a small amount of cash for per week or two until the next paycheck clears), which carry rates of interest that sound reasonable when you look at the short-term context — ten percent over fourteen days, state, plus some costs. However in annualized terms, these loans carry a normal price of 391 percent, as well as in some situations soar far greater than that.

This industry includes a reputation that is poor avid customers of progressive media — mom Jones’s Hannah Levintova characterized the avoid Loan Sharks Act as being a crackdown on “predatory interest rates,” while Sarah Jones at brand New York mag stated Sanders and Ocasio-Cortez had been teaming up “against businesses that prey in the bad.”

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