OKLAHOMA CITY - House Bill 1913 will create a new small loan for those borrowing between $500-$1,500.
"They're voluntary. No one is forced to take them, and they're to people that for whatever reason in their life, they've had more income risk, and that's why those loans are important," President of Oklahoma Council Of Public Affairs Jonathan Small, said.
It recently passed the House of Representatives which was a heated debate for some lawmakers with personal experience.
"I watched my dad crunch numbers, stretch meals, take on additional jobs and walk in and out of payday lending centers,” State Representative Cindi Munson (D) District 85 said.
State Representative Munson believes they prey on service members like her father.
It was a similar experience for Harmony Fuller whose father took out a payday loan before being diagnosed with pancreatic cancer.
"By the time we paid the full loan off they continued to solicit him even to the very end when he was basically on hospice care," Fuller said.
HB1913 would have a 17% interest rate cap per month, which translates into a 204% annual interest rate.
Those for the bill believe a "small loan" is a more short term solution and should be paid off quickly.
"They don't have cash in between two paychecks so a quick loan helps them make and bridge that gap," said Jonathan Small with the Oklahoma Council of Public Affairs.
He says their office helped the authors with the bill and believes the so called "Small Loan Act" will help with high premiums from Obamacare.
"Most of the insurance premiums right now are because of the out of control costs of healthcare, many people when they have a surgery, their deductible is at least that amount," he said.
Opponents disagree and say it's another debt trap preying on the vulnerable.
"Many people are using them regularly and going into a debt trap and so instead of Oklahomans being prosperous, it's keeping people down," Bailey Perkins with the Oklahoma Policy Institute said.
Senator James Leewright sent us a statement saying the following:
“HB 1913 will provide consumers with a small-dollar loan option that has a repayment period longer than a few weeks, offers increased borrowing flexibility and requires licensing and regulations by the state. When the Consumer Financial Protection Bureau acts to severely limit access to short-term credit, HB 1913 will ensure Oklahomans have access to a variety of credit options to manage unexpected financial difficulty.”
For more information on HB 1913, click here.