The Senate Banking and Insurance Committee passed (5-2) a bill that would create a new statewide consumer-loan program that could charge interest rates as high as 36 percent on small-dollar loans. Florida statutes consider interest rates beyond 18 percent to be usurious. However, consumer finance loans (installment loans largely accessed by individuals with limited access to capital and traditional financial services) are allowed to charge up to 30 percent under current Florida law.
While the FCCB generally supports alternatives to payday lending, a robust consumer loan industry already exists in Florida. SB 894 (Rouson) would initiate an unnecessary pilot program that would further raise interest rates and create a new debt trap for low-income consumers.
The companion measure, HB 857 (Fernandez-Barquin), has yet to be heard by its committee references.