Some reformers scoff as interest rate cap bill advances

Storefront lenders would be limited to charging interest rates of 175 percent under a bill that cleared a Senate committee Monday, but consumer groups called the measure inadequate.

The bill sponsor, Sen. Clemente Sanchez, D-Grants, said his plan would stop interest rates of 300, 500 or even 700 percent that have led to dozens of futile attempts by legislators to regulate an industry that critics say preys on the downtrodden.

“It will eliminate the high interest rate loans we have heard about for years,” Sanchez told the Senate Corporations and Transportation Committee, which unanimously advanced his proposal, Senate Bill 388.