Govenor Beshear Reaffirms Support for 36% Cap

2 10 2009

Beshear Pledges Support for Payday Lender Cap Despite Fund-raiser

Governor Steve Beshear

Governor Steve Beshear

Bluegrass Politics Oct. 2009 [FRANKFORT] — Gov. Steve Beshear said Wednesday (9-30-09) that he remains committed to stricter regulation of payday lenders even though his re-election campaign held a fund-raiser last week at the Tennessee home of a payday lending executive who does business in Kentucky. Beshear said he was not reluctant to hold the fund-raiser at the Cookeville, Tenn., home of Garry McNabb, chief executive officer of Cash Express, which has more than 100 outlets in Kentucky. It also is registered to lobby the executive and legislative branches in Kentucky.

The Democratic governor, who is seeking re-election in 2011, said McNabb was one of several hosts of the event. Several consumer advocates who have pushed for more restrictions on payday lenders — which can charge upward of 400 percent interest — have expressed concern about the fund-raiser.

Beshear, who was a lobbyist for the payday lending industry in 1998, said he still supports legislation to cap the annual interest rates payday lenders can charge at 36 percent — the amount Congress has implemented for military families. The industry claims a cap on payday advances would drive lenders from the state and deprive families of access to emergency credit, increasing bounced checks and bankruptcies. “We are going to move forward to creating further and stronger regulations, capping interest rates” in next year’s legislative session, Beshear said.

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