Support National Interest Rate Caps

Resolution Number SD09.28

Support National Interest Rate Caps

WHEREAS, many financial institutions levy usurious fees and engage in harmful lending practices, with interest rates on tax refund loans ranging from 20-50 percent; and on “overdraft loans” as high as 25 percent; and

WHEREAS, banks’ usurious interest fees are generating, $327-billion in overdraft revenue (NY Times, 9-08-09), and $600 million in tax refund loans (MSNBC, 1/09/2009) all of which disproportionately hurt the working poor; and

WHEREAS, consumers who rely on tax refund loans and overdraft loans, are usually in desperate debt, falling victim to high interest rates that make it difficult for borrowers to repay the loan, thus putting consumers on a perpetual debt treadmill;

THEREFORE BE IT RESOLVED, that the California Democratic Party supports imposing a national cap on interest rates not to exceed 10 percent on overdraft and tax refund loans; and

BE IT FURTHER RESOLVED, that a copy of this resolution be sent to all members of the California congressional delegation, as well as the CEO’s of Bank of America, Wells Fargo and other large financial institutions imposing usurious fees.

Author: Marcy Winograd, AD 53; Endorsed by Region 17 and Region 10 delegations;
Progressive Democrats of the Santa Monica Mountains; Adopted by a majority of DSCC present
at the CDP Region 17 meeting, October 3, 2009
Author: Mark Bowen; Adopted by the Progressive Democratic Club;
Adopted by a majority of the DSCC members present at the CDP
Region 17 meeting, October 3, 2009.

* * *

Adopted by the Executive Board
Of the California Democratic Party
At its Executive Board Meeting
Hyatt Regency Mission Bay Hotel, San Diego
November 15, 2009

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