Stay Curious. Stay Connected.
MailNewsletters♡Donate Now
Sign up
*Password must be at least 8 characters and contain one uppercase letter, one lowercase letter, one number and one symbol.
Already have an account?
By submitting, you consent that you are at least 18 years of age and to receive information about MPR's or APMG entities' programs and offerings. The personally identifying information you provide will not be sold, shared, or used for purposes other than to communicate with you about MPR, APMG entities, and its sponsors. You may opt-out at any time clicking the unsubscribe link at the bottom of any email communication. View our Privacy Policy.
Sign in to your profile
Forgot Password?
New to MPR News?
Welcome back
to news
for you
Reset Password

Enter the username on file and we'll send you a code to reset your password.

Still require assistance or not sure what your User Name is?
Welcome back
to news
for you
Email Verification

A verification code has been emailed to

Still awaiting the code?
Mike Cronin, Associated Press
St. Paul, Minn.

Payday lending bill stalls on final day

Go Deeper.

Create an account or log in to save stories.

Like this?

Thanks for liking this story! We have added it to a list of your favorite stories.

Legislation designed to protect borrowers from falling further into debt to payday lenders fell short of winning final approval as Minnesota lawmakers ended their session Friday.

The Senate had voted 37 to 25 to send a bill to the House, which had earlier adopted a different version. But the session concluded before lawmakers could craft a common proposal, meaning advocates will have to wait until next year.

Payday loans are short-term loans typically made without checking the borrower's credit or ability to pay. Instead, the lender gets the right to withdraw the money from the borrower's bank account the next time the borrower will have the money to pay it back. If the borrower can't, the lender lets the borrower pay the debt by taking out another short-term loan.

The measure sponsored by Sen. Jeff Hayden, DFL-Minneapolis, would have limited borrowers to 10 loans a year and requires lenders to check whether the borrower already is overextended. The proposal also requires lenders to determine whether the borrower is a member of the military. If so, the annual percentage rate would have been capped at 36 percent.

"This is going to help folks get out of the debt trap," Hayden said.

Opponents said the bill would simply push people in debt to unregulated and dangerous sources of quick cash, such as Internet sources or old-school loan sharks.

"That's a problem with this bill," said Sen. David Brown, R-Becker. "It'd be better if people could get loans from state-regulated lenders."

Gov. Mark Dayton urged lawmakers earlier this week to pass the bill.