Akron City Council unanimously passed a resolution of support for State Issue 5, the referendum on reform of payday lending, which appears on the Nov. 4 ballot.
The resolution, offered by At Large Councilman John Conti, Mayor Don Plusquellic and Council as a whole, would safeguard the reforms passed in Ohio House Bill 545.
The bill caps interest rates on so-called payday loans at 28 percent, increases the term of those loans from a typical two-week term to 30 days, limits borrowers to four maximum $500 loans per year, offers access to other small loan alternatives and bans Internet lending.
A yes vote on Issue 5 keeps those protections in place, and mandates a 28 percent maximum APR on all loans – contrary to what opponents of the measure may have voters believe, Conti said.
“There’s been quite a bit of confusion with the advertising on this issue,” Conti said. “The opponents talk about 5,000 jobs and privacy being lost if Issue 5 passes. This is demeaning the effort to continue regulating payday lending.
“These lenders want to keep a 391 percent annual interest rate basically on a two-week loan.”
Conti noted that Issue 5 also is supported by the Akron Beacon Journal, AARP, the Ohio Manufacturer’s Association and statewide religious leaders.