OKLAHOMA CITY – A proposed bill that would have raised the state cap on short-term personal loans was vetoed by Governor Fallin.
Current law limits borrowers to a $1,000 loan from a payday loan institution, but Fallin says Kannaday’s bill would allow a borrower to get an additional loan for $1,500 with annual percentage interest of more than 200 percent.
Fallin issued her veto message late Friday, saying she had concerns about the impact that House Bill 1913 would have on low-income families in Oklahoma.
The bill was sponsored by Republican state Rep. Chris Kannaday of Oklahoma City and strongly supported by the payday lending industry, which has hired several lobbyists and given tens of thousands of dollars in campaign contributions to legislators.
The bill drew controversy, with some saying it was up to Oklahomans on whether or not they wanted to take out the loans.
“People choose whether or not to take out these loans. Nobody is being forced to take out a loan, to not take out a loan. We’re creating a framework in state law that allows people to have access to these financial products,” Trent England, the Senior Vice President for the Oklahoma Council of Public Affairs, said.
Others believed it would only put Oklahomans further into debt.
“We applaud Governor Fallin’s veto of HB 1913, which would have created a new high-interest payday loan for Oklahomans. This veto protects seniors living on fixed incomes and others targeted by predatory lenders. AARP Oklahoma is a leading consumer advocate and believes in protecting the financial security of all as we age which is why we fought hard and opposed HB 1913,” said AARP OK State Director Sean Voskuhl.
“I think the message this bill sends is we’re not going to fund core services of government but here’s another loan product that you can use to get you out of a tight spot but put you further into debt,” said Rep. Forrestt Bennett. “We have a $900 million dollar budget shortfall right now and over the last several year,s agencies that take care of the most vulnerable in our population have been cut, leaving people stranded.