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Kentucky lawmakers axe short term lending bill

Feb 17, 2011 Todd Milner

A bill moving through the Kentucky legislature aimed at capping short term lending interest rates was shot down by lawmakers, who were motivated to keep the industry at its current standing, the Lexington Herald-Leader reports. The bill would have capped short term loan interest rates at 36 percent, but the Kentucky House Banking and Insurance Committee dismissed the bill, leaving interest rates at their current levels. However, despite the bill's failure this time around, it was not completely stricken from future meetings, only from the current House session, the paper details. The decision to dismiss the bill was welcomed by John Rabenold of the Deferred Deposit Association, who stated that short term lending is a necessary part of the state's economy. "Eliminating short term from the state, you favor the Costa Ricans," Rabenold told WPFL-FM. "You favor the Modoc Indian tribe in Miami, Oklahoma. There is internet lending. It’s very prevalent. And this is a choice of – are we going to help out the Kentucky-based businesses, or are we going to export all that to out-of-state businesses?" Voting was close nevertheless, as the margin to squash the bill resulted in a 13-10 split, the radio station reports.