Nebraska voters approve interest rate cap on payday lenders

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Ahmed Morsi brings along his month-old son Omar, while filling his ballot at a polling place in Omaha, Neb., Tuesday, Nov. 3, 2020. (AP Photo/Nati Harnik)

OMAHA, Neb. (AP) — Nebraska voters have overwhelmingly approved a measure to cap the annual interest rate on payday loans at 36%.

Initiative measure 428 changes existing state law, which allows lenders to charge more than 400% annually.

Supporters of the measure argued that such high rates victimize low-income borrowers and those who do not understand lending requirements.

Industry officials countered that the high rates are misleading because most loans are short-term and that capping the interest rate will put lenders out of business.

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