Pennsylvania state Sen. Pat Browne (R-Allentown) is preparing to introduce new legislation that he claims will stamp out payday lending by gradually transitioning consumers into mainstream credit. Consumer advocacy organizations, however, are gearing up to fight a plan that they say will continue to sanction high-cost loans and extended periods of debt. Under Browne's proposal, "micro-loans" of up to $1,000 would bear 28 percent simple interest with a 5 percent application fee. The plan does not allow for loan rollovers, so borrowers who cannot repay on time would be offered an extended payment plan. Still, borrowers are eligible for a new loan one business day after repaying the old -- a provision that consumer advocates say has the same effect of a rollover: creating a debt cycle. "The basic precepts are the same," complains Bill Harris, president of the Pennsylvania Council of Chapters of the Military Officers Association of America. His and other groups worry that the loans would hurt older veterans on fixed incomes and younger vets returning from deployment with injuries and/or no job. Browne counters that he has included terms that prevent the cycle of debt, including a limit on the number of consecutive loans a person could borrow. After eight short-term loans, they would be offered longer-term options to help build a credit history. Borrowers who fail to complete eight loans and move into longer-term products would be blocked from borrowing for a period.