INDIANAPOLIS – On Thursday, State Senators Eddie Melton (D-Merriville) and Frank Mrvan (D-Hammond) worked together to defeat Senate Bill (SB) 245 in the Senate Insurance and Finance Committee. Similar forms of the bill have been offered in the past and failed to move out of committee.
During SB 245’s testimony, faith-based organizations and consumer advocacy groups urged the Indiana General Assembly to not advance the proposal. SB 245 would have allowed loan officers to lend a minimum amount of $605 and a maximum of $2,500 to an individual for up to a 24-month payback period. The loan would see an annual percentage rate three to five times higher than the threshold in Indiana.
“I strongly believe the legislature should develop more safe guards to protect Hoosiers from predatory lending,” Sen. Melton said. “I also believe the Indiana Department of Financial Institutions should do more to provide further transparency on the over 30 payday lending license holders and their more than 300 stores across the state of Indiana.”
In a bi-partisan agreement, the committee voted 5-4 on Thursday halting the bill from moving to the Senate floor.
“Payday lending is a rabbit hole that unfortunately many Hoosiers are pushed into due to a number of extenuating circumstances,” Sen. Mrvan said. “The defeat of this bill means that we are protecting our residents from exorbitant interest rates which lead to bankruptcy.”