Metro Council on Tuesday passed a law restricting where pawnshops and payday lenders can locate, a measure intended to stop the businesses form clustering close together.
Councilwoman Jacobia Dowell of Antioch sponsored the bill. It prevents payday lenders from setting up shop a quarter mile from each other.
It passed unanimously and with no discussion.
“I think over the course of the last three years, we’ve seen what a proliferation of certain businesses in communities can do. They can take out the economic wealth in the community. They can contribute to higher crime rates. And they can also contribute to the economic delineation of very key areas of our city,” Dowell said.
The original legislation proposed to limit how big the businesses could be, a cap of 2,500 feet, but that restriction was scratched in its final version.
The new law also does not restrict a business’ hours of operation. Many of the major payday lenders in Nashville are open 24/7.
Payday loans are short-term, high-interest lines of credit popular among those in a pinch or without traditional bank accounts.
Existing shops will be grandfathered in, but new ones will have to follow the distance rules.