COLUMBUS — A proposal cracking down on Ohio’s short-term lending industry is headed to Republican Gov. John Kasich.
During a rare July session day Tuesday, the Ohio House voted 60-24 to approve a Senate version of the bill that added restrictions over the payday lending industry’s objections.
“I am thrilled that after sixteen months of deliberation, the Ohio House has taken decisive action to protect consumers. I am grateful to my colleagues and to the people of Ohio for their input and support. Both were essential to the creation of this bill, which will benefit consumers across our state,” said Rep. Kyle Koehler (R-Springfield), who co-sponsored the bill with Rep. Michael Ashford (D-Toledo).
The bill caps interest rates and limits fees on such loans. It also bars loans with terms of less than 30 days.
Payments on loans of 90 days or less can’t exceed 7 percent of a borrower’s monthly net income, or 6 percent of the gross income, under the plan.
Fees and interest can’t be more than 60 percent of the loan’s original principal amount.
Ohio has some of the highest payday loan rates in the nation.
The bill prohibits borrowers from owing more than $2,500 in outstanding principal at a time from multiple lenders and limits monthly maintenance fees to either 10 percent of the principal or $30, whichever is less.