Vermont helps Feds stop 'Payday Loan' debt traps

Vermont Business Magazine The federal Consumer Financial Protection Bureau (CFPB) hasannounceda national rule that will eliminate payday loan debt traps by requiring lenders to ensure that borrowers can repay their loans. Vermont already bans payday loans and other forms of high-interest lending.Around 12 million Americans use payday loans. The new rule is estimated to eliminate two-thirds of the payday loans currently offered across the country.

The rule will not affect Vermont’s laws, but will help raise the floor of protections in other states where payday loans are offered. Since 2012, Vermont has been a leader in protecting consumers from harmful lending practices, including cracking down on illegal online lending and working with Google toban advertisingfor payday lenders.

The Vermont Attorney General’s Office worked closely with the CFPB and other states to help shape the rule. “This rule is a great example of state and federal cooperation to address a financial problem that affects millions of working Americans,” said Attorney General T.J. Donovan.

For more on Vermont’s lending laws and enforcement efforts, visit the Attorney General’s “Illegal Lending”webpage.

Vermont AG: Oct 20, 2017