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Cedar Rapids Cracks Down on Payday Lenders
DES MOINES, Iowa (AP) -- Efforts to limit payday lenders in Iowa have repeatedly failed in the Legislature, but more cities are approving zoning changes that make it harder to open the businesses.
Cedar Rapids last week became the latest city to approve an ordinance that bans the short-term loan businesses from certain areas. It became the sixth Iowa city to approve such a law, leaving opponents of the loan shops hopeful that the city-by-city limits will prompt the Legislature to take action.
Lawmakers have introduced measures that would cap interest rates at 36 percent, but the proposals have stalled. Opponents of payday lenders argue they can trap people in a cycle of debt.
Community Financial Services Association of America, which represents storefront payday lenders, says a statewide interest rate cap limits options for consumers.
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