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Nebraska votes to cap payday loan interest rate at 36%

Yahoo Finance's Aarthi Swaminathan joins Yahoo Finance Live to discuss Nebraska voting to cap payday loan interest at 36%.

Video Transcript

- Something that didn't get huge headlines because everyone is looking at the presidential election was an important thing that happened in Nebraska. We invite back into the stream Yahoo Finance correspondent Aarthi Swaminathan to talk about payday loans and what the voters in Nebraska did. Aarthi?

AARTHI SWAMINATHAN: Hey, Adam. So Nebraska did something really interesting. They voted for the president. But that aside, they actually voted to stand up to payday lenders. So they are the 17th state to limit interest rates. And this brings down the annual percentage interest rate from 400% to 36%.

So they're following in the footsteps of states like New York, New Jersey, Colorado, South Dakota, and I think it's worth noting that 700,000 people in Nebraska voted for this. 83%, that's 83% of the population-- so a lot of people are involved in this fight.

But what this is super interesting to me is that, at the federal level, we have some efforts made by CFPB, by OCC, like all these different government agencies, to make life easier for payday loans. But at the same time, at the state level, consumers are like, no. We had enough.

So I can get into details. But just basically know that there is a fundamental disconnect is what people on the ground want and what the company administration has done.