Iowa City becomes fifth city in Iowa to crack down on predatory payday loans

CCI members call for statewide interest rate cap

Iowa CCI members call on the Iowa State legislature to cap payday loan interest rates after Iowa City became the fifth city in Iowa to pass local zoning restrictions on payday lenders September 18.

CCI members in Des Moines, West Des Moines, Clive, and Ames have all won similar ordinances at the local level in their home cities.

“The win in Iowa City is a great victory for us, and our next step is a statewide interest rate cap,” said Bryson Dean, a CCI member from Iowa City. “Cities across Iowa are doing what they can to crack down on predatory payday lending and it’s time for the state to follow suit with an interest rate cap.”

Payday loans are short term loans with an interest rate near 400% that can trap borrowers in a cycle of debt while contributing to neighborhood blight.

Senator Joe Bolkcom (D- Iowa City) has sponsored legislation in past years to cap interest rates on payday loans at 36% - the same rate that banks and credit unions are limited to.