FOR IMMEDIATE RELEASE
Contact: Lance Gideon, Press Secretary
Lance.Gideon@iga.in.gov
317-234-9221
STATEHOUSE (Jan. 29, 2024) — A bill authored by State Sen. Spencer Deery (R-West Lafayette) that would give low-income Hoosiers more alternatives to expensive payday loans passed the Senate with a bipartisan vote of 41 to 8 Monday, Jan. 29.
Senate Bill 200 would introduce more competition into the emergency loan market by requiring some government employers to provide access to nonprofit community loans or loans with similar terms as an employee benefit.
"While payday loans offer Hoosiers a lifeline, interest rates tend to be higher than traditional loan options and don't allow a borrower to build credit," Deery said. "This bill would help expand the nonprofit loan program already in place in Indiana at no cost to taxpayers."
Under current state law, Community Loan Centers (CLC), which are licensed and regulated, offer emergency loans at a lower interest rate compared to traditional payday loans. They also work to help borrowers get on a more stable financial footing through financial training and credit building. SB 200 would gradually require more public employers to allow their employees to use payroll deductions to pay off a nonprofit loan like a CLC loan, or a loan from a bank or credit union that is offered under the same favorable terms.
"Getting employers to understand what a nonprofit loan is and how simple it is to offer as a benefit is one of the biggest obstacles to creating alternatives to payday loans," Deery said. "I am pleased that the Senate passed this legislation to potentially help more Hoosiers access this loan opportunity."
The bill now moves to the Indiana House of Representatives for further consideration. To learn more, visit iga.in.gov.
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State Sen. Spencer Deery (R-West Lafayette) represents Senate District 23,
which includes Fountain, Parke, Vermillion and Warren counties,
and portions of Montgomery and Tippecanoe counties.
Click here to download a high-resolution photo.
