SPRINGFIELD, IL – State Senator Jacqueline Y. Collins (D - Chicago) passed Senate Bill 87 out of the Illinois Senate today which prohibits currency exchanges from providing tax refund anticipation loans.

In Illinois and across the county, currency exchanges have been raking in high profits from tax refund anticipation loans at the expense of consumers. These types of loans often result in high interest rates and penalties that disproportionately impact poor and disadvantaged communities.

“As we continue to face a strained economy it is important that we protect consumers,” Senator Collins said. “Making sure currency exchanges in Illinois cannot provide services which are detrimental to the disadvantaged, according to many research studies, is a step toward preserving the financial future of our communities. I also stand in partnership with community organizations that focus on financial education because it is vital that more Illinois families learn the tools to better protect and grow their wealth.”

Senate Bill 87 also increases fees on currency exchanges. The Woodstock Institute, a community based non-profit, is in favor of this measure. In a recent report the Woodstock Institute stated it “supports the raising of licensing fees [in Senate Bill 87] to levels consistent with other regulated financial institutions, such as those licensed under the Payday Loan Reform Act and the Consumer Installment Loan Act.”

Senate Bill 87 will now await consideration in the Illinois House.