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St. Louis voters approve annual fee for short-term lenders

A payday loan shop on Natural Bridge Avenue east of Union Boulevard. The high interest rate of payday loans can leave people on the hook for paying more in interest than the original loan.
File photo | Camille Phillips | St. Louis Public Radio

St. Louis voters have passed a ballot measure that will impose an annual $5,000 fee on short-term lenders, such as payday loan and car-title lending establishments.

The measure, known as Proposition S, was approved by about 60 percent of voters. The measure was sponsored by 20th Ward Alderman Cara Spencer.

The measure also will:

  • Hire a commissioner to inspect short-term lenders and make sure any new short-term lenders seeking a permit are at least 500 feet from houses, churches and schools, and at least one mile from similar businesses.

  • Require short-term lenders to clearly post what it charges in interest and fees.

  • Require short-term lenders to offer a guide on alternatives to short-term loans.

Spencer, who is the executive director of the Consumers Council of Missouri, has said the goal was to better regulate the industry in St. Louis and push state legislators to take broader action.


In Missouri, short-term lenders can roll over loans up to six times. So while the average short-term loan is about $300, the average APR paid is 462 percent, according to the latest report on the industry by the Missouri Department of Insurance, Financial Institutions and Professional Regulation.


Last month, St. Louis Public Radio was unable to reach United Payday Lenders of Missouri, an industry group based in Jefferson City, for comment.

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