Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending
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Re: Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending
#2Big benefit for payday lending companies who charge obscene fees mostly in poor and minority areas of the country.
Which consumers is the CPB protecting?
Re: Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending
#3Big benefit for payday lending companies who charge obscene fees mostly in poor and minority areas of the country. Which consumers is the CPB protecting?
The ones with very deep pockets who own the payday lending companies, of course.
Re: Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending
#4Big benefit for payday lending companies who charge obscene fees mostly in poor and minority areas of the country. Which consumers is the CPB protecting?
Consumers who run payday lending companies.
Re: Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending
#5Isn't the problem less about predatory payday loans and more an existential issue around the fact that so many people can't afford to simply live?
People take these bad loans because they literally have no other choice. They are using these loans to buy groceries and cover bills, not splurge on non-essentials.
Re: Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending
#6Big benefit for payday lending companies who charge obscene fees mostly in poor and minority areas of the country. Which consumers is the CPB protecting?
> Which consumers is the CPB protecting?
Those very same consumers. Large, established players do not want to even touch that customer base because it represents a high risk and a low payoff.
These are the only financial services these people have access to. Cutting that off is not a solution.
Encouraging competition and increasing the number of players will reduce the "obscene fees". People aren't stupid, they'll always pursue the lowest cost option.
A good article/video to listen about this topic:
https://reason.com/reasontv/2017/04/13/lisa-servon-banking-c...
Re: Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending
#7Here is the best argument in favor of the change:
>> if the rule had kicked in, some two-thirds of borrowers wouldn't qualify for a payday loan
If the above is true (and not fake news), I would like to understand how the industry was expected to survive with 2/3rd of its customer base taken away in an instant; and what alternative services these customers would have been routed to...
Re: Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending
#8Isn't the problem less about predatory payday loans and more an existential issue around the fact that so many people can't afford to simply live ? People take these bad loans because they literally have no other choice. They are using these loans to buy groceries and cover bills, not splurge on non-essentials.
I grew up in a flyover state with a history of very creditor-friendly laws and (limited) legal gambling.
It's boringly, heartbreakingly common there to see small, multi-tenant commercial buildings where one of the tenants is a payday loan place, and another (if not the other) is a "video lottery"/casino type joint.
In the limited digging I ever bothered doing, both establishments (and often the building) were ultimately owned by the same party.
So, no. Not predatory at all...
Re: Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending
#9Big benefit for payday lending companies who charge obscene fees mostly in poor and minority areas of the country. Which consumers is the CPB protecting?
> Which consumers is the CPB protecting? Those very same consumers. Large, established players do not want to even touch that customer base because it represents a high risk and a low payoff. These are the only financial services these people have access to. Cutting that off is not a solution. Encouraging competition and increasing the number of players will reduce the "obscene fees". People aren't stupid, they'll al…
There are a few startups, like Earnin, Even, and SoLo Funds trying to tackle this problem in different ways. Lending options for those markets are vitally important, for sure, but we can find a better way of doing it without abusing the ones who need it most.
Re: Consumer Protection Bureau Aims to Roll Back Rules for Payday Lending
#10Big benefit for payday lending companies who charge obscene fees mostly in poor and minority areas of the country. Which consumers is the CPB protecting?
Consumers who run payday lending companies.
Yup. This was made pretty clear when they tweaked the mission statement back in 2017. http://www.msnbc.com/rachel-maddow-show/the-cfpbs-mission-st...
> The banking watchdog’s mission statement now lists its first order of business as hunting down “outdated, unnecessary, or unduly burdensome regulations.”