Governor Jay Nixon (D) has vetoed legislation aimed at restricting payday loans, dismissing the bill as not being true reform.

“Senate Bill No. 694 provides false hope of true payday lending reform while in reality falling far short of the mark,” writes Nixon in his veto message.

The bill would prevent consumers from taking out new short-term loans, as can happen under six times under current law, with interest continuing to accumulate. It would also require that once a year, lenders offer extended 60- to 120-day payment plans to borrowers, free of additional interest or fees.

The bill would also cap interest fees on loans at $35 for every $100 in principal. The current cap is 75-percent of the original principal.

Nixon writes the bill, “fails to protect consumers and fails to prevent the cycle of debt that payday lending perpetuates.” Instead, he says the bill, “appears to be part of a coordinated effort by the payday loan industry to avoid more meaningful reform.”

See the legislation, SB 694

The bill passed both legislative chambers by margins wide enough to overturn Nixon’s veto, if enough lawmakers would vote the same way.