Rate Cap Spells End For Nearly Half Of Short-Term Lenders
PIERRE, S.D. (AP) – New state figures show that nearly half of South Dakota’s short-term lenders aren’t renewing their licenses after voters capped the interest rates they could charge.
Figures provided to The Associated Press on Friday show that 85 lenders reported they didn’t renew for 2017 because their products didn’t comply with the new regulations.
The initiative approved by voters in November was aimed at protecting people from predatory lending. Opponents of the measure had warned that it would drive out businesses that serve a need for people who can’t get loans elsewhere.
The law limits short-term loan interest rates to 36 percent annually.