Comment of the Day
February 6, 2009 | Uncategorized | Comments (0)In my opinion, the legislators are just covering up their own incompetence with regards to regulating the payday loan industry. How many people in state government have ever taken a payday loan? The problem is that they are not ‘middle class’ people and they don’t understand the product. Instead of taking the time to understand the product and coming up with viable regulations, they decide that its best that they put in a rate cap that puts lenders out of business (some are even ignorant enough not to believe that!).
Their lack of understanding causes weak oversight and allows some lenders to use abusive lending practices (such as charging excessive interest). If they actually did their homework, stopped looking down their nose at a business they hardly understand (and its customer base), and worked on a more universal approach to regulation, they would do the business and the public a great service.
It is the state governments, not the lenders, that are to blame for the controversy over this essential product for the public. Anyone who says otherwise has either been raked over by a non-reputable (poorly regulated) company or has never had the need to look for a short-term loan.
Comments»
No comments yet.