COLUMBUS—State Representative Kyle Koehler (R-Springfield) today applauded the announcement by the Ohio Department of Commerce regarding the issuance of a license under the Short Term Loan Act as amended by House Bill 123 of the 132nd General Assembly. SCIL, INC., which operates Speedy Cash storefronts, has been awarded the first-ever license under the small loans section of the Ohio Revised Code.
“One of the biggest arguments against payday lending reform was that if we imposed actual fairness constraints on lenders, they would shut down and leave Ohio. Instead, what we see is the first license being issued in the eleven long years since the legislature first tried to address payday lending,” Koehler said.
Rep. Koehler and joint sponsor Rep. Michael Ashford (D-Toledo) introduced HB 123 in the 132nd General Assembly. The legislation closed loopholes and clarified statutes regulating the payday lending industry, including the Short-Term Loan Act, to ensure payday lenders are operating under intended guidelines.
HB 123 was a consumer protections bill. The law prohibits borrowers from owing more than $2500 in outstanding principal at a time from multiple “payday lenders” while continuing to protect them from unscrupulous lending practices. The law limits monthly maintenance fees to either 10 percent of the principal or $30, whichever is less and caps the overall fees for a loan at 60 percent of the principal.
Further licenses will be issued by the Ohio Department of Commerce as applications are processed.