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It's a fine line between financial riches and ruin, and legislation in Ohio could trim it even further into areas never anticipated.

House Bill 545 is designed to put stricter regulations on payday lending institutions — regulations proponents say will protect those who may be stuck in a cycle of debt due to the easy access and high interest rates for the loans.

The bill would cap the annual percentage rate on payday loans at 28 percent. Currently, the lenders can charge $15 for $100 lent over a two-week period, which works out to a 391 annual percentage rate.

It would also limit consumers to borrowing $500, and restrict borrowing to four times per calendar year. The term of the loans would be extended to 31 days from 14 days by the legislation.

Ohio Gov. Ted Strickland said he plans to sign the bill into law. It has already been approved by the House and Senate.

In preparation for what seems to be an imminent future, several payday lending institutions said they are going to close their Ohio stores.

Columbus-based Heartland Cash Advance said they will shut down, and Cleveland, Tenn.-based Check Into Cash announced it will close its 93 shops in the state.

A potential house of cards

Not only could 6,000 Ohioans be potentially out of work if lenders are forced to shutter their businesses as a result of the legislation, but families and businesses that depend on the quick loans could also be facing a dire future.

Like West Chester Twp. contractor Brian Douglas.

"You do what you've got to do to stay in business. But this could put me out of business."

Douglas said he refinishes basements in Butler County — an already tough business as residents pinch pennies in the face of an uncertain U.S. economy.

In order to get a job done, Douglas will borrow money to purchase the equipment. Unable to get a traditional bank loan, he turns to payday lending to provide the cash he needs several times a year.

"Borrowing $200 to $500 to do a job, when you pay it back in two weeks, you could end up making $2,200 bucks," he said.

Without payday lending, Douglas said he may not have an option to get the equipment. He's never been able to get that kind of help from banks, but they will be holding all of the cards.

"Banks are really turning their backs on average working person," he said. "It's like people are taking away our freedom and choices a little at a time."

Is the pot calling the kettle black?

Opponents of current payday lending practices argue the shops snag the poor into a hopeless cycle of debt as they take out new loans to pay off old ones. But industry leaders said the $15 charge on a $100, two-week loan offers consumers access to emergency money that's much cheaper than bounced checks or utility fees.

The average fee for a bounced check is $27.04, and many banks include a tiered system that can triple that fee in as little as 10 days, according to a recent survey by bankrate.com.

Darryl Dever, chief Ohio payday loan industry lobbyist, told lawmakers during testimony the loan fees can add up to less than bank fees when used responsibly.

When you're on disability and money continues to get tight, Middletown resident Hugh Lake said payday loans save him from paying those high bank overdraft fees.

"I have gotten behind with overdraft fees and with the prices they charge, I could have got a short loan for a lot less," he said.

At his bank, any amount overdrawn up to $500 charges $34 for the first ten days.

If the balance is not restored by then, Lake is charged another $34. A $15 fee for $100 to pay the bill or overdraft is small in comparison, he said.

With so many people in foreclosure from not being able to pay bank mortgages or swimming in credit card debt, it's curious so much is being focused on an industry considerably smaller than banking institutes, Lake said.

"Payday lenders are not the loan sharks they make them out to be. All the government is doing is taking away my options."

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