Red, White & Blue
Senator's bill would cap payday loan interest rate
BOISE, Idaho (AP) -- A Magic Valley senator is taking aim at Idaho's payday loan industry and the high interest rates companies charge customers.
Republican Sen. Lee Heider of Twin Falls says a bill he will introduce would cap interest rates at 36 percent and force full transparency of loan terms.
Heider announced his plan Monday at a press conference with the Idaho Citizens Action Network. According to Heider, interest rates on payday loans can inflate to as high as 500 percent.
Heider says he was inspired after one of his employees struggled paying back a high interest loan.
It's not the first attempt to regulate the industry. Last year, a Democratic bill to cap interest rates stalled in committee.
Idaho caps payday loan amounts at $1,000 but doesn't regulate interest rates.