Federal APR Cap Bill Concerns National Black Chamber

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Federal APR Cap Bill Concerns National Black Chamber

A recent letter from the National Black Chamber of Commerce to US House Committee on Financial Services Chair, Maxine Waters (D-CA), points to the potential consequences of the imposition of a 36% Annual Percentage Rate (APR) cap on African Americans, and particularly on African American entrepreneurs.

The letter points out that a cap of 36% APR would:

  • Risk excluding millions of Americans from the credit community by completely “unbanking” them,
  • Particularly affect African American women,
  • Exacerbate the effect of credit deserts, meaning those desperate to make ends meet must choose less desirable options like bouncing a check, or bankruptcy,
  • Reduce options for African American entrepreneurs, who are more likely than White entrepreneurs to rely on personal credit to raise start-up capital.

The full text of the letter is below:

NB Chamber Letter 111319 (opens as PDF)

SOURCE: National Black Chamber of Commerce