CNN has a story: “What Consumer Advocates Want From Obama.”
Here are some other issues he {Consumers Union spokesperson} says need attention:
• Consumers need effective regulation of financial-services products, including an agency independent of banks to protect consumers. This regulation would focus on products like mortgages, payday loans and annuities.
Watch Ali Velshi on what Obama should do first »
• Make credit products agreements easier to understand and appropriate for the consumer. End “gotcha” fees and interest-rate spikes. Recently, the Federal Reserve ordered a crackdown on some controversial credit card practices, but those changes won’t take effect until 2010. Butler says that’s too long. His organization wants these changes take effect within three months.
For the most part, payday lenders are on the same page. No service has more transparency than a payday loan. Another government agency, though? Won’t that tread on the traditional role of states in regulating consumer lending?
It would be nice if there were a federal body to regulate payday lending. There would be one set of rules and one regulatory body overseeing it. Multi-state lenders would have lower costs and could pass that on to the customer with lower rates. Competition would drive down the cost to consumers, too. It would give legitimacy to the product, give higher protecton to consumers, and drive the bad apples out of business. All the talk about ‘internet’ and ‘overseas’ lenders would stop, because they would all have to register with the federal government. There would be no jurisdictional issues.
Plus, we can get rid of these state regulators who are not always the most competent or impartial bunch. Local politics would not affect the regulation of this business anymore.