The maximum lending amount for payday loans could be curbed under a new proposal unveiled Tuesday by state Assembly Democrats.
The Responsible Lending Act would limit payday loans to $600 or 35 percent of an individual's biweekly income, whichever is lower. Lenders would also be prohibited from making loans to individuals who are currently repaying a separate payday loan.
According to state Rep. Donna Seidel, D-Wausau, the new amendment is the product of a compromise among lawmakers who worked for the past several months on consolidating competing reform proposals.
""[The goal of the bill is] meaningful regulatory reform with comprehensive consumer protections as well as being the Assembly proposal most likely to become signed into law and … immediately benefit the citizens of Wisconsin,"" she said.
The compromise comes just days after Assembly Speaker Mike Sheridan, D-Janesville, acknowledged he dated a payday lender lobbyist.
Last week, Sheridan's spokesperson, Rebekah Sweeney, said Sheridan's personal relationships will not affect his support for payday loan regulations. In a statement, Sheridan said he is pleased with the amended legislation and plans to bring the bill to the floor as soon as possible.
The Assembly Committee on Financial Institutions will meet Wednesday to take up the revised version of the payday loan legislation.
