The Crescent Report

December 11, 2007

VA Muslim Community Leaders Call for 36% Cap on ‘PayDay’ Loans

Filed under: From the Desk of Imam Mahdi Bray — Tags: , — Imam Mahdi Bray @ 2:06 am

This Tuesday, December 11, 2007 at 11:00 am in The Muslim Association of Virginia/Dar Alnoor Mosque (5404 Hoadly Road, Manassas, VA 20112), the Virginia Interfaith Center for Public Policy and various Muslim leaders and Imams in the State of Virginia will call upon the State legislators to end usury in Virginia and cap the interest rate of payday loans at 36%.

In 2002 the payday loan industry drafted a bill for itself that exempted it from Virginia's usury cap - the law that caps the interest of all small loans at 36% APR.  They pushed this bill through our General Assembly and in July 2002 it became legal for them to charge an average interest rate of 390% APR on a two week loan.  It is legal but not moral.

Three years ago many of Virginia's religious leaders recognized that this form of lending was usurious and predatory, and requested that the VirginiaInterfaithCenter address the issue. Since that time, the Center and other consumer advocates have met fierce resistance from the payday industry as they have grown more and more afraid of losing their special entitlement that makes usury legal for them.

The press conference is the Virginia Muslim community's response to this resistance.  "We will not back down," says Ann Rasmussen, Policy Director of the VirginiaInterfaithCenter.  Like their brothers and sisters in the Christian and Jewish communities, the Muslim leaders will amplifying the voice of the faith community as it speaks truth to power and call on our state legislators to enforce Virginia's usury cap law and limit the interest rate of payday loans to 36%."

People of faith are taught that God does not ask us to care for the poor and liberate the oppressed, God requires it of us.  The cries of those hurt by the payday industry will not fall on deaf ears. The Muslim community will continue to raise its voice until those in power stop enabling the payday industry to exploit the poor and vulnerable among us.

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