Arizona Consumers Council

On Monday the House Banking and Insurance Committee decided not to discuss and vote on HB2161. The bill apparently will undo regulation on payday loans set to go into effect this year. Consumer advocates from Center for Economic Integrity, Center for Responsible Lending, No More Loan Sharks, Consumer Federation of America and AARP Arizona attended. They’re dedicated to upholding the sunset on 400% provision they believe protects consumers from so-called predatory lending. The Arizona Daily Sun has followed this continuing saga, recently referring to Representative Andy Tobin:

Undeterred by voter rejection more than a year ago, a top House Republican is working to keep payday lending alive in Arizona beyond June 30.

The bill would allow payday loan companies to make permanent what is now a waiver from being required to conduct business with a 36% cap on interest rates. Supporters of the bill say payday loan companies will be unfairly limited if recent regulations are allowed to take effect. In 2008 Arizona voters were asked and decided that they wanted the protection of a 36% interest cap. Consumer advocates want to let the sun set on 400%, for them a requirement that reflects what consumers want and need.

Due to a lack of votes to approve the bill in committee, Tobin removed it from the hearing agenda while stating plans to revisit it when more stakeholders would be present. Fellow committee member Representative Doug Quellan asserted that the consumer advocates who attended should be considered stakeholders and be invited to such a meeting.

In a discussion at the state capitol, David Higuera of No More Loan Sharks indicated that consumers and advocates can claim a victory this time around, even though the battle over payday regulation in Arizona is expected to continue.