It started off so well….
I would like to discuss an article I have found today. And it started off so well…..
“The best thing that can be said of payday lenders is that their practices are no more predatory than some by banks, credit unions and credit card companies.”
- YES!! Sometimes it seems so far and few between that we receive truthful press which presents the facts about the Payday Lending Industry clearly! Needless to say, this article had me sold early on. Let’s read on.
“In fact, avoiding big fees on small overdrafts is one of the reasons that people turn to payday lenders.”
- Great (and obvious to us in the Industry!) point. Wow, this article is not only off to a great start, but staying right on track. Let’s read on.
“Payday loans, also known as deferred deposit loans, would be capped at 36 percent interest under House Bill 38….”
- Ok, since the rest of the article has been clear, honest and concise I am certain they will follow this up with some facts about what a 36% APR cap would do to Payday Loan operators (close their doors!) and also show some numbers to educate readers on how APR’s calculated on short-term loans differ greatly from those on a 30 year mortgage, for example. After all, this information is available to anyone, and any decent reporter would do his homework before slandering an entire industry, right?
No, I was wrong. It started off so well, and dwindled down into yet another under-researched filler piece which showed no real interest in truthful reporting. The article then went on to speak about how Kentucky Rep. Jeff Greer had refused to hear a bill to cap the APR for Payday Lending in Kentucky at 36% and has taken $1,750 from miscellaneous Payday Loan lobbyists as well.
Perhaps he did his homework and actually LEARNED how to properly calculate APR percentages, and knows that a 36% cap would make it nearly impossible to meet your operating costs, let alone make enough money to survive!
The article also failed to mention the sums of money that legislators receive from the BANKING industry in order to ensure that legislation AGAINST the Payday Loan industry will pass so that they can hopefully bring in another 38 billion next year in overdrafts? So much for un-biased reporting.
Alas, let’s end this on a positive note. I feel strongly that we in the Payday Loan Industry are in in the “right” and that we will stay strong and we will educate others about the product we have to offer. And that product will not simply “disappear” because the public need for the service we offer will not simply “disappear”. The slander, mis-truths and backlash from the banking industry is only due to our SUCCESS in providing a viable product for our customers, the vast majority of which whom report being satisfied with our product. There are VERY FEW official complaints on record from our customers, and any of the objections to “preditory” practices can be curbed with slight regulation, not only by regulating us out of business (36% cap on APR!).
So let us rejoice in our past success, stay strong and informed, and band together and march forth into an exciting future of Payday Lending!!