Payday loans, small dollar loans… the pros and cons of a federally mandated 36% APR. Where do folks go if small-dollar lenders are forced underground?
No doubt, more than a few legislators “get” that the elimination of small-dollar loan products does not solve the basic problem: 70% of US households cannot get their hands on $500 cash in an emergency! [Watch the Video below.]
Yes, this is horrible. Yes, few of my readers here can relate to this fact. Unemployment is at record lows. Our economy is kicking ass! Employers are struggling to secure talented employees.
And yet, we have a problem. The publicly traded lenders are an easy way to gain a bit of transparency.
ENOVA reported they’ll loan $1.2B.
CURO reported just over $1B for their year.
Robert Sherrill, CEO, Imperial Cleaning Systems is a convicted felon who used small-dollar loans to make ends meet and establish a successful business after serving time. The “Financial Services Committee” is SO BIASED and uninformed while residing in their Ivory Towers, that they actually accused Mr. Sherrill of testifying favorably about payday loans “in order to get clemency from President Trump!” Egads…
House Financial Services subcommittee on consumer protection and financial institutions hearing, “Ending Debt Traps in the Payday and Small Dollar Credit Industry.”
Here’s the Video to the Hearing: