From a letter in the Springfield News Leader from QC’s Tom Linafelt:  

Short-term payday loans each year help thousands of Missouri families overcome unexpected financial circumstances and avoid more-expensive fees associated with bounced checks and late bill payments. In addition to being more expensive, these options negatively impact credit ratings and may hurt a consumer’s access to employment, housing, insurance and other credit options.

And with credits cards and other alternatives being squeezed, this short-term credit option is needed more than ever.

From a letter in today’s Springfield News Leader: 

Before you embrace the magic number 36, like Governor-elect Jay Nixon has, think where you would go if your credit is rocky and all you have to your name is a XYZ Bank checking account, a job at the local ___Mart, or a 1995 Ford Taurus with 180,000 miles.

Center for Consumer Freedom’s Tim Miller has weighed in on the Missouri proposal to cap interest rates:

When short-term payday lenders close their doors, their customers are often forced to resort to less desirable and more expensive alternatives to make ends meet.

The whole letter is worth a read.

They simply don’t understand that a 36% rate cap is a ban.  From the Springfield (MO) News Leader:

It’s time for Missouri legislators to soften the political posturing — and proselytizing — and look to what other states have done.

According to studies, others states–Oregon, North Carolina–have hurt their citizens by reducing their financial options.

As the Payday Pundit has pointed out before, most credit union or bank “alternatives” to payday loans are either not profitable or cost the same as a payday loan.   This story highlights an effort in Illinois to open a “not for profit” payday loan store on busy interesection in Springfield: 

IN GOD WE TRUST is preparing incorporation papers and scouting out sites along MacArthur Boulevard for a not-for-profit alternative to payday loans. Kevin Slot, owner of Tailored Printing Inc. of Springfield, has been working with The Ministerial Alliance of Springfield on the project.

He told members of the MacArthur Boulevard Business Association last week the group is looking for volunteer counselors for the storefront operation. The association has led the fight to limit the number of new payday loan outlets in Springfield.

It’ll be interesting to keep track of this, see what the fees are, see if they are heavily subsidized by either the government or a charity.   If there’s a Payday Pundit reader in Springfield, please check this out for us.  We’ll post your info here. 

Ryan Cooper, a freelance writer, is convinced more than ever that the free market offers consumers the most choices: 

The decision haunted me as I read the online bank statement. A combination of holiday spending, personal property taxes and a recent job loss caused me to overdraw my checking account.

If I didn’t come up with $200 by 7 p.m., I would bounce four checks. Each bounced check fee was about $30, for a total of $120.

In addition, my bounce protection only covers up to $350. After that amount, each check keeps bouncing until paid.

I had two options. I could cover the difference by returning every Christmas gift and pawning valuables. Or I could borrow money from a payday loan business.

I chose the payday loan option. I didn’t want to punish my children for circumstances beyond their control.

The whole column is a good read.

Tom Linafelt of QC Holdings, a leading payday lender out of Missouri, takes on a local newspaper columnist.   From Tom’s rebuttal piece in the Springfield News-Leader.

Missouri payday lending laws already include some of the strongest consumer protections in the country. By including limits on loans, loan renewals and associated fees, those laws protect consumers from creating a “cycle of debt” and from experiencing the kinds of annualized percentage rates referenced by industry critics.

These are the kinds of strong consumer protections the payday lending industry consistently supports.

Let’s give reasonable, hard-working Springfield-area consumers access to a variety of regulated credit options and trust them to make financial decisions based on what’s best for them and their families.