Michigan Senate Passes Bill Capping the APR on Payday Loans at 36%

Wednesday, July 30, 2025
Current fees on these loans reach an APR as high as 370%. A majority of borrowers in Michigan end up falling into a cycle of debt. According to a report released by the Center for Responsible Lending, 70% of borrowers in Michigan take out another loan on the same day they pay one off.
“CEDAM commends our State leaders for taking steps to protect Michigan consumers today,” said Jessica AcMoody, policy director at CEDAM. “Michiganders of all income levels deserve access to safe, affordable financial products. SB 632 will support an environment where consumer-friendly financial programs and products can thrive.”
More than 100 Michigan organizations — including nonprofits, churches, cities and financial institutions — signed a letter to Michigan Senators supporting SB 632 in an effort to protect communities from these high-cost products.
“So many of our clients have been negatively impacted by these predatory loans, often falling into a cycle of debt or even being forced to file for bankruptcy,” said Lorray Brown, consumer law attorney at Michigan Poverty Law Program. “We are thrilled Michigan’s leaders took steps to protect Michigan’s most vulnerable community members from products that masquerade as a quick financial fix, but actually cause long-term harm.”
The bill now moves to the House of Representatives where it will be assigned to a committee.
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CEDAM is a nonprofit membership association building vibrant communities across Michigan. Our capacity building programs, policy advocacy, and training events emphasize supporting communities in the areas of affordable housing, economic growth, and wealth-building at both the federal and state levels. Through engagement and collaboration with CEDAM members, policymakers, state departments, and other partners, we sustain a thriving and equitable community economic development sector across the state.
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