House Democrats today applauded the passage of House Bill (HB) 123, a bipartisan effort to enact consumer protections for the thousands of Ohioans who utilize short-term loans every day. Borrowers in Ohio currently pay some of the highest rates in the nation for payday loans, with estimated average interest rates at over 500 percent.
“HB 123 provides a fix to a loophole that has allowed predatory lenders to rig the system against working Ohioans,” said state Rep. Michael Ashford (D-Toledo), one of the bill’s joint sponsors. “These protections put money back into the pockets of consumers and gives them a chance to get a fair deal for an opportunity to get ahead.”
Under HB 123, borrowers would have more time to pay back loans, and monthly payments would not exceed seven percent of monthly net income. The bill also prohibits interest and fees from exceeding 60 percent of the original loan principal.
“Working families who struggle to put food on the table or gas in the tank will benefit from this long overdue reform,” said House Minority Whip Emilia Sykes (D-Akron). “These commonsense consumer protections were a long time coming, and Ohioans will now have the peace of mind of knowing that when they apply for a short-term loan, they will be getting a fair deal.”
The bill’s swift passage comes amid allegations of corruption and criminal activity at the Statehouse. Former House Speaker Cliff Rosenberger (R-Clarksville) resigned his office in April after reports surfaced the GOP lawmaker had taken illegal money from payday lending lobbyists for overseas trips.
“Payday lending reform is long overdue, but it concerns me that it took an FBI investigation into alleged criminal corruption at the Statehouse to get this bill moving,” said Assistant Minority Leader Nick Celebrezze (D-Parma). “Questions remain, and Ohio taxpayers deserve answers to know who is really calling the shots in Columbus.”
The FBI has since launched an investigation into the alleged activity, raiding the former speaker’s office, home and personal storage unit earlier this year. Rosenberger is the first speaker in Ohio history to resign while under federal criminal investigation. The scope of the ongoing criminal probe is not yet known
After passing the House by a vote of 60-24, HB 123 moves to the governor’s desk to be signed into law.
Here is what other state lawmakers are saying about the passage of HB 123:
“Taking on unfair practices and cracking down on predatory lenders ensure Ohio consumers are getting a fair deal,” said state Rep. John Patterson (D-Jefferson). “This bill is a step in the right direction to close legal loopholes that have cost Ohioans for over a decade.”