New polling shows near universal support among voters for requiring apps to charge no more than 36% APR
WASHINGTON — A coalition of more than 225 labor, civil rights, consumer and community groups urged members of the U.S. House of Representatives to oppose H.R. 9330, legislation scheduled to be voted on momentarily in the House Financial Services Committee. The groups warn this bill would increase costs for people by exempting Payday Loan Apps — which on average charge over 300% APR and take hundreds of dollars a year in fees and interest from low-wage workers — from laws that help stop lenders from fleecing consumers. For instance, the bill would override usury laws, which would effectively eliminate the interest rate caps that protect residents of 21 states and the District of Columbia — over 100 million Americans — and military servicemembers from triple-digit interest rate loans.
The 226 undersigned labor, consumer, civil rights, and community organizations write to oppose H.R. 9330, the misnamed Earned Wage Access Consumer Protection Act, which exempts earned wage payday loans from the Truth in Lending Act (TILA), the Military Lending Act, the Equal Credit Opportunity Act, and other federal laws. The bill preempts state laws that protect people from spiraling costs, endorses unaffordable loans that make workers pay to be paid and facilitates new evasions by payday lenders. The bill would deprive servicemembers of the protections of the Military Lending Act and override the Consumer Financial Protection Bureau’s well-reasoned explanation in 2024 that these paycheck advances are loans and their hidden costs are finance charges.
Additional Developments
- During her opening remarks this morning at the House Financial Services Committee markup that will later include a vote on H.R. 9330, Ranking Member Maxine Waters expressed strong opposition to the bill stating, “… it creates new loopholes, weakens consumer protections, overrides strong state laws, which could leave workers paying more in fees and with fewer rights when something goes wrong.”
- Today, 15 State Attorneys General voiced their opposition to H.R. 9330.
- Two dozen organizations based in states where payday lending is categorically illegal have just launched the Stop Taking Our Pay (STOP) Coalition to oppose this federal bill and state legislation that exempt Payday Loan Apps from consumer protections.
- New polling from the Center for Responsible Lending and Americans for Financial Reform shows that 84% of voters support prohibiting these apps from charging more than 36% APR — far from their typical rate of over 300% APR.
###
Press Contact: Matthew Kravitz matthew.kravitz@responsiblelending.org