“Foolish” points
November 10, 2008 | Motley Fool, alternatives, industry, media coverage, personal finance | Comments (0)We’re referring to the MotleyFool, which has a very interesting and hard-hitting piece today on Wells Fargo bank and other “alternatives” to payday lending. From the piece:
The FDIC began a pilot program this year to have traditional financial institutions offer micro loans at interest rates that payday lenders have said are unprofitable. While thousands of loans have been made, it’s not a runaway success because the banks are finding it hard to make money just as the payday industry has. One of the things not addressed in the pilot program, though, is providing loans to people with poor credit. Payday lenders do that every day; banks won’t loan money to someone who has bad credit.
Because they have the imprimatur of the federal government, banks have the right to employ the same programs payday lenders are castigated for. Perhaps that explains why they’ve been so vociferous in their support of restrictions on payday lenders: They just don’t want the competition.
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