The 30,000-member union gave its support for Senate Bill 632, which will cap payday lending loan interest rates at 36%
LANSING, Mich. (April 8, 2024) – On behalf of its 30,000 members, the Service Employees International Union (SEIU) of Michigan announced today that it is supporting Senate Bill 632, which will cap interest rates on payday lending loans in Michigan at 36% and better protect working families and communities. The legislation, sponsored by Sen. Sarah Anthony (D-Lansing), will put Michigan on par with 20 others and the District of Columbia.
“SEIU Michigan is another strong voice of support for this long-awaited change to combat predatory payday lending practices and protect Michigan’s workers and communities from financial vulnerability and generational debt,” said Sen. Anthony.
By voicing their support of Senate Bill 632 today, SEIU of Michigan joins a chorus of widespread support from consumers, financial experts and community advocates from around the state. This includes well-known state and national policy advocates like the Community Economic Development Association of Michigan, the Michigan Catholic Conference, the Michigan League for Public Policy, and the Center for Responsible Lending as well as more than 100 local groups from communities across Michigan, from Adrian to Marquette, Detroit to Muskegon, Lansing, and almost everywhere in between.
“For far too long, predatory payday lending has hurt Michiganders and put borrowers in a cycle of generational debt,” said Jennifer Root, Executive Director of SEIU Michigan. “SEIU Michigan is proud to support SB 632, which will begin to chip away at an industry designed to target communities of color and the financially vulnerable. We applaud Senator Anthony for her leadership and urge the House to pass this commonsense step to dismantle corporate self-interest that takes advantage of working people.”
SB 632 is cosponsored by Senators from both sides of the aisle and earned bipartisan support in its Senate passage on March 14, 2024. The bill now moves on to the House for consideration.
People who use payday lenders are more likely to file for bankruptcy than non-borrowers with similar financial circumstances. In addition, 70% of payday borrowers in Michigan reborrow the same day they pay off a previous loan and 75% of payday lenders’ revenue comes from borrowers caught in 10 loans per year. Studies also show that payday lending stores are more likely to operate in Black and Latino communities, which can contribute to long-term economic disparities.
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