New Mexico lowers interest rate cap on storefront loans | News from New Mexico

SANTA FE, NM (AP) – Gov. Michelle Lujan Grisham signed legislation aimed at underwriting loans to local start-up businesses with taxpayers’ money and a consumer protection law that lowers the maximum interest rate on installment loans of $10,000 or less.

The governor on Tuesday signed legislation allowing the state to allocate $50 million for future investments in New Mexico venture capital projects that can be risky for investors but have the potential for superior returns.

The bill, by Democratic lawmakers including Albuquerque Assemblymen Javier Martínez and Santa Fe Assemblyman Linda Serrato, responds to concerns about New Mexico’s ability to retain and attract early-stage companies.

The governor also signed legislation lowering the maximum interest rate on store loans from 175% to 36%, with some exceptions for loans of $500 or less.

The bill, by lawmakers including Democratic Rep. Susan Herrera of Embudo, also doubles the maximum size of in-store installment loans to $10,000.

Political cartoons

Advocates say new restrictions are needed to ensure borrowers don’t fall into vicious cycles of debt that contribute to New Mexico’s poverty. The new credit restrictions will come into effect on January 1, 2023.

Lujan Grisham, a Democrat who is seeking re-election in November, has until March 9 to sign legislation including a proposed $8.5 billion general government spending plan for July 1 beginning financial year. Excess invoices are automatically vetoed.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, transcribed or redistributed.

About admin

Check Also

Georgia Amends Its Laws On Residential Mortgage And Installment Loans | Alston & Vogel

A&B summary: On May 2, 2022, Georgia Governor Brian Kemp signed HB 891 and SB …