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Factsheet: Michigan Voters Overwhelmingly Support 36% Rate Cap

February 18, 2020
Payday and Other Small Dollar Loans
Payday Loans

For most of Michigan’s history, state laws prevented payday lenders from operating, most recently by limiting interest on consumer loans at 25%. However, in 2005, Michigan became the last state to authorize payday lending when payday lenders pushed for a carve out allowing them to charge rates of 340% APR or higher. Payday lenders drain over $103 million in fees from Michigan residents every year. Now, they want the ability to make longer-term loans at APRs as high as 200%. Michiganders do not want payday lending to expand. Instead, Michigan needs reform proven to stop the debt trap—a true rate cap on payday loans that restores a maximum rate of 36%.