About 50 people rallied on the Statehouse steps in Montgomery to show their support for legislation limiting interest rates on payday and title loans.
Members of the Alliance for Responsible Lending gathered Tuesday to support bills from Democratic Rep. Rod Scott of Fairfield and Patricia Todd of Birmingham that limit interest to 36 percent. The group backing the bills includes representatives of Alabama Appleseed, the Alabama Federation of Republican Women, the state NAACP, and AARP.
Governor Robert Bentley announced a new consumer protection measure today aimed at helping people avoid excessive amounts of debt from payday loans.
The measure will also help lenders by providing a method to ensure they are complying with state law. Under the Alabama Deferred Presentment Services Act, payday lenders are not to issue loans to customers who currently have more than 500 dollars in existing payday loan debt.
Several Alabama legislators are proposing bills to place restrictions on payday and title loans, including capping the interest rates.
Legislators say their bills would limit annual interest rates at 36 percent. The loans can now have annualized rates of 456 percent on payday loans and 300 percent on title loans.
Democrat Ron Scott of Fairfield says he's optimistic about passage because the bills have a broad range of support, including the Southern Poverty Law Center, NAACP, AARP and Arise Citizens' Policy Project.
New payday loan businesses won't be allowed to open in Birmingham until at least next June.
The city council on Tuesday extended a ban on the businesses until June 19, 2013.
Officials picked that date because it comes after the end of the Legislature's regular session. They want lawmakers to address the number of payday loan businesses in their city and across Alabama during the session.