OAKLAND, CA – Following release of a new California Department of Financial Protection and Innovation (DFPI) report, Center for Responsible Lending Director of California Policy Marisabel Torres issued the following statement:
This report is the first since California’s groundbreaking law capping annual interest rates at 36% went into effect. The data show that the law essentially eliminated triple-digit interest rate loans that are between $2,500 and $10,000, which is a significant victory in protecting consumers from these predatory products. California policymakers should now take the next logical step and apply a strong rate cap to loans with principals outside this dollar range.
The report also shows an explosion in ‘buy now pay later’ loan volume and a transformation of the market toward this product. This highlights the importance of additional study of ‘buy now pay later’ as well as vigilance in consumer protection.
We will continue to work with state officials to monitor all forms of credit and to ensure they are safe and affordable for all Californians.
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