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Economy

Ohio's Payday Lenders Charge the Highest Interest Rates in the U.S.

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WKSU
1 of 10 Ohioans has taken out a payday loan.

A report from the Pew Charitable Trusts shows payday lenders in Ohio charge the highest interest rates in the U.S.

Interest rates for payday loans in Ohio are as high as 591 percent. That’s despite the 2008 Short-Term Lending Act, which limits interest rates to 28 percent.

Pew's Alex Horowitz is encouraging Ohio to follow other states that have taken action to curb predatory lending.

“Colorado enacted reform in 2010. And the same payday lenders operate in Ohio and in Colorado. But they charge Ohio residents four times more for the same loans.”

Two years ago, Ohio’s Supreme Court upheld a loophole allowing payday lenders to register as credit-service organizations, which can charge high interest rates.

Ohio lawmakers are expected to consider bipartisan action  next year to close the loophole.