Federal crackdown on abusive pay day loans could backfire in nyc

The federal watchdog agency for customer financial loans simply released a draft of nationwide guidelines for the payday lending industry. Generally in most states, these guidelines really are a welcome initial step toward reining in payday loan providers, whose enterprize model involves recharging on average 300% yearly interest, primarily to low-income individuals who can minimum afford those predatory prices. In nyc, nonetheless, we have to protect our already-strong customer defenses.

Like 13 other states together with District of Columbia, nyc imposes a limit on rates of interest, rendering it impossible for payday loan providers become profitable.