SENATE BILL: Loan Shark Prevention Act (Passed)

[Devout Centrist]

This bill would limit the interest rate charged on credit card users. it would also institute postal banking and allow consumers to open a savings account at their local post office.

I am willing to work with lawmakers to make the cap on interest more flexible and equitable. Once again, I accept any constructive criticism regarding this proposal.

[Devout Centrist]

Postal Lending was embraced by my first administration and signed into law by my successor DFW when Congress failed to deliver to my desk before I left office.

So it has been law for over two years now.

Alright, thank you for pointing that out. I'll amend this bill accordingly.

[Devout Centrist]

Presenting the following amendment:

SENATE BILL
To protect consumers from usury
Be it enacted in both Houses of Congress

Section 1; Title
1. This legislation may be cited as the "Loan Shark Prevention Act".
Section 2; Substance
1. Interest rates on credit cards shall be capped at a maximum of 15%.
a) If state or regional laws prescribe a lower cap, then nothing in this legislation shall prevent the lower cap applying instead of the 15% cap.
b) Any fees that are not considered finance charges shall not be used to evade the limitations of this paragraph, and the total sum of such fees shall not exceed the total amount of finance charges assessed.
2. The Federal Reserve shall have the authority to waive the prescribed 15% interest rate cap for a maximum of 18 months if-
a) A determination is made that prevailing interest rate levels seriously threaten the safety and soundness of individual lenders, as evidenced by meaningful adverse trends in liquidity, capital, earnings and growth.
b) This clause shall not affect the regulations regarding credit unions.
3. If a fee or interest rate greater than the cap prescribed in this legislation is knowingly charged to consumers, the entire interest shall be forfeited.
a) A usurious collection that is forbidden by this legislation shall be able to be entirely recovered from the lender provided that a legal action is brought no later than 2 years after the date on which the last usurious collection was made.
b) Nothing in this section shall be construed to pre-empt state or regional laws that provide greater consumer protection than in this legislation.
4. The Atlasian Postal Service shall be permitted to engage in banking services.
Section 3; Implementation
1. This legislation shall come into effect one year after its passage into law.

[Devout Centrist]

I believe the amendment has been adopted?

[Devout Centrist]

I'm not seeing very many comments here, I'm looking for any comments concerning the upper threshold on interest rates charged for credit card holders.

[Devout Centrist]

No thx. Saving money by churning  and getting subsidized by financial idiots is great for me.

Ah yes, profiting off the backs of the poor and the working class. You're an excellent example of what's wrong with the Federalist Party.

[Devout Centrist]

Yes I like my 2% savings on every purchase. Idiots aren't forced to use credit cards.

In order to build a credit history, people need to make purchases on credit...

[Devout Centrist]

I'm not seeing very many comments here, I'm looking for any comments concerning the upper threshold on interest rates charged for credit card holders.

The thing that comes to my mind would be concerns about them not lending to certain people, though that may or may not be a bad thing in the abstract it could certainly be inconvenient in the short term for some people.

Indeed, some folks may not be able to use credit card services with their history under this bill. However, I believe there are ways to help those people without letting credit card firms take advantage of them.

[Devout Centrist]

So on the subject of those other ways to mitigate the impact?

Hmm...give me some time to research a flexible ceiling on credit card APR. Perhaps that would be a better solution.

[Devout Centrist]

I'm writing an amendment to put a flexible cap on APR around 17%. Will post it here tomorrow.

[Devout Centrist]

Presenting the following amendment:

SENATE BILL
To protect consumers from usury
Be it enacted in both Houses of Congress

Section 1; Title
1. This legislation may be cited as the "Loan Shark Prevention Act".
Section 2; Substance
1. Interest rates Annual percentage rates (APR) on credit cards shall be capped at a maximum of 15%17%.
a) If state or regional laws prescribe a lower cap, then nothing in this legislation shall prevent the lower cap applying instead of the 1517% cap.
b) Any fees that are not considered finance charges shall not be used to evade the limitations of this paragraph, and the total sum of such fees shall not exceed the total amount of finance charges assessed.
c) The maximum APR for super prime credit holders shall be set to 13%
d) The maximum APR for prime credit holders shall be set to 15%
e) The maximum APR for all other credit holders shall be set to 17%
2. The Federal Reserve shall have the authority to waive the prescribed 15% 17% interest rate cap for a maximum of 18 months if-
a) A determination is made that prevailing interest rate levels seriously threaten the safety and soundness of individual lenders, as evidenced by meaningful adverse trends in liquidity, capital, earnings and growth.
b) This clause shall not affect the regulations regarding credit unions.
3. If a fee or interest rate greater than the cap prescribed in this legislation is knowingly charged to consumers, the entire interest shall be forfeited.
a) A usurious collection that is forbidden by this legislation shall be able to be entirely recovered from the lender provided that a legal action is brought no later than 2 years after the date on which the last usurious collection was made.
b) Nothing in this section shall be construed to pre-empt state or regional laws that provide greater consumer protection than in this legislation.
Section 3; Implementation
1. This legislation shall come into effect one year after its passage into law.

[Devout Centrist]

I motion for a final vote

[Devout Centrist]

Aye