Widely differing views of the payday loan industry and a bill tightening state regulation of it are displayed during debate on the House floor.

The House has approved HB 656 and sent it to the Senate on a 99-57 vote.

The final vote came after a calmer debate on the House floor than the debate preceding initial approval. Debate might have been calmer, but it still displayed the sharp differences of opinion about the industry itself. Payday loans are short-term, high-interest notes typically given to tide a person over until payday. If not paid off, interest rate charges escalate into astronomical rates. The average Annual Percentage Rate on a payday loan taken out in Missouri totals 440%.

Rep. Mary Still (D-Columbia), the chief critic of the legislation, claims the bill allows a maximum APR of 1,564%. She claims HB 656 merely enforces the status quo and continues to allow the industry to entrap financially strapped and naïve consumers into a cycle of debt.

Supporters dismiss her calculations, claiming they are misleading, since a payday loan is short-term, never meant to be outstanding for a year or more. Rep. Dave Schatz (R-Sullivan) insists they provide a service other lending institutions, such as banks, do not. Supporters also contend the industry is important to Missouri, employing some 10,000 workers.

Debate during the amendment process became increasingly heated. Critics assailed the bill. Supporters claimed their criticism went too far and became personal.

AUDIO: House floor debate on payday loan bill [30 min MP3]