Alexandria Del. Mark Sickles on Friday called for substantial limits on payday lending that would cap not only how much, but how often, someone can borrow under the short-term loans.

Sickles, a Democrat, joins a growing push to crack down on the lending practice, which critics say exploits low-income and fiscally illiterate residents. His bill would restrict the amount of a payday loan to 25 percent of a borrower's monthly income, up to $1,000, and allow a person to have only two outstanding loans at any time, among other caveats.

"My objective in my bill is to make sure absolutely no Virginian falls into a spiral of debt due to a series of payday loans," Sickles said at a press conference in Richmond.

A bill from R. Lee Ware Jr., R-Powhatan, would create an online database that lenders would be required to check if an applicant is eligible for a loan, as well as restrict loans to members of the military.

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Another, filed Thursday by Del. Dwight Clinton Jones, D-Richmond, would limit the interest that could be charged on a payday loan to 36 percent annually.

Jamie Fulmer, a spokesman for Advance America, a major payday loan company, said such a cap would be "an effective ban of the industry" in Virginia.

"Critics of the industry understand that, and that's why their pushing this," he said.

Legislators have struggled for years over how to regulate the payday lending industry. If legislators can accomplish reform during the current General Assembly session, Sickles said, it will be "well worth our effort to see if we can develop other public policies and encourage our more established lenders to get into this low-dollars, very short-term market."

Fulmer, who prefers Ware's bill, said Sickle's legislation is a "valiant attempt to find a middle ground" but would go too far beyond the $600-per-loan cap in existing state law.

wflook@dcexaminer.com