Payday lenders charging interest rates higher than 400 percent will no longer be allowed to operate in Arizona after a 10-year-old law expires Thursday.

Lending companies failed to persuade voters or the Legislature to extend the provision allowing the high interest loans.

Attorney General Terry Goddard and consumer groups say the expiration of the law may not be the end of the industry and plan to monitor companies when the law changes July 1.

Goddard said payday lenders have bypassed restrictions in other states by continuing to charge high interest rates and fees on other products.

Industry lobbyist Lee Miller said local lenders might close while national companies could continue to offer products like money orders and auto-title loans.

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