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House passes bill raising caps on industrial-loan interest rates after extended debate
Summary
The Tennessee House approved Senate Bill 6 94 on third reading March 18, increasing statutory caps on rates and certain fees for industrial loan and thrift companies despite robust opposition from members who called the change onerous for low‑income borrowers.
NASHVILLE — The Tennessee House of Representatives voted March 18 to pass Senate Bill 6 94, a measure that raises the statutory cap on permitted effective interest rates for certain industrial loan and thrift companies and increases the maximum acquisition charge those lenders may assess.
Supporters said the change was needed to reflect higher costs of doing business and to allow lenders to serve borrowers with poor credit who otherwise have no access to short‑term loans. Opponents called the measure a step toward predatory lending that would make it more expensive to be poor.
Representative Powers, sponsor of the measure on the floor, said the bill increases the cap "from 30 to 36 percent" and raises the "maximum permitted acquisition charge" from 10 percent to 12.5 percent. He told members such loans…
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