The California legislature is getting closer to approving legislation that would cap interest rates at 36 percent on loans between $2,500 and $9,999; in 2017 56 percent of loans made between this range had an annual percentage rate of 40 percent or higher; the sponsor of the bill, Democratic Assemblywoman Monique Limón, said the bill is intended to hit at the high default rates as she explained to American Banker, “More than one out of three times, these loans leave people worse off than when they started,”; there is concern that this will leave some people behind since the rates are capped lenders will not approve loans to riskier borrowers. Source.
