Joint Trades Opposition Letter to Sen. Reed's Rate Cap Bill

Dear Senator Reed:

The undersigned trade associations, representing financial institutions that serve hundreds of millions of American consumers, write in opposition to S. 3549, the “Predatory Lending Elimination Act” that would impose a limitation to fees and interest charged on consumer loans through an all-in national rate cap of 36 percent.

Small dollar loans, credit cards, and other forms of short-term credit are critical for helping consumers meet emergency expenses, disruptions in pay, and misalignments in the timing of their expenses and income. The proposed 36 percent fee and interest cap would make it more difficult for many consumers to obtain credit, thereby harming the very consumers the legislation seeks to protect. Congress should reject these legislative measures.

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