New Hampshire is moving to add some short-term credit products in the state.

“We should not take the right away from the citizenry to do what they want. Sometimes they do what they have to do,” said Rep. Ken Gidge, D-Nashua.

An payday lending employee defends short-term credit in a New Hampshire newspaper.

Our New Hampshire stores – and other similar lenders – closed in 2009 after the Legislature passed regulations that made it impossible to operate. We helped tens of thousands of people overcome temporary financial shortfalls. And yet, among the many customers we served in the last half-dozen years, fewer than five of them filed complaints.

A state senator in New Hampshire wrote an op-ed this weekend explaining her effort to create a short-term lending product in the state.

… When working families find themselves in need of short-term credit to address these needs, our state laws do not allow for a safe, viable option – in many cases, forcing consumers to turn to costly and unregulated products.

New Hampshire continues to discuss ways to bring short-term credit back to the state. Nothing has been approved yet, but one business journal seems to think something will be chiseled out in the Granite State.

In the end, the measure was tabled, but will no doubt re-emerge some time in the future.

New Hampshire is back debating payday lending and short-term credit. In an op-ed, a state senator uses the tired argument of not sending money to out-of-state companies. That means this guy only shops with mom-and-pop stores and has never shopped at Kmart.

Enabling these types of loans is not, in my opinion, particularly business friendly to New Hampshire companies either: With companies headquartered in the Carolinas, the profits go out of state while the damage caused to New Hampshire consumers remains here.

And if you need a reminder of the damage caused by lost jobs in New Hampshire after the industry was shut down, read this piece from 2009.

A newspaper in New Hampshire says payday lenders can make two-week loans and charge 36 percent annual interest.

Companies like Advance America could make these loans at more reasonable interest rates and still make a substantial profit. They choose not to.

No. It’s impossible. That’s why no payday loans are offered for 36 percent. Maybe newspapers should start offering two-week loans at 36 percent to supplement lags in print advertising since it’s so easy.

This time New Hampshire lawmakers are realizing how hard they made it for businesses in the Granite State.

Quandt’s argument regarding high-interest loans is that they represent a convenience to consumers in a short-term bind. He also says that the law that set the 36 percent interest rate maximum effectively ended the payday lending business in New Hampshire and cost hundreds of people their jobs. That’s wrong he says.

From an article today in the Concord Monitor:

A year ago, the state Legislature outlawed payday and title loans in order to protect consumers from paying exorbitant interest rates. But that hasn’t stopped some lenders from offering other types of short-term loans at equally high interest rates.

Today, the House will vote on a bill meant to close what some consider a loophole in the law. Opponents of the bill say it will remove the last resource for people desperate for short-term loans.

“I don’t think those people with bad credit should have no place to turn for a loan,” said state Rep. Jeff Goley, a Manchester Democrat and chairman of the House Labor Committee.

Senate Bill 193 would put a 36 percent cap on annual interest rates, including some fees, for any loan under $10,000. It would apply to both loans and lines of credit.

There’s a tremendous disconnect between elected officials and working Americans.  It seems as if the officials are listening to a few anti-business advocacy groups and not their constituents.

A Center for Consumer Freedom letter in today’s Eagle Tribune (N.H.):

Short-term “payday” lenders have been under attack by state and federal lawmakers who denounce their services as “predatory.” But across the country, borrowers in need of emergency cash choose these loans willingly, over other financial options. Research by a Federal Reserve economist found that 88 percent of short-term borrowers are satisfied with their loans.

From the story:

Last session, lawmakers drove most payday lenders out of the state by capping interest rates at 36 percent, but some companies have found a way around the law that by imposing such charges as membership and loan consultant fees.

House Bill 193, at the request of the banking commissioner and the attorney general’s office, would try to change all that by making the cap an aggregate 36 percent on all loans under $10,000, payday or not.

The House Commerce Committee – which has traditionally favored the payday loan industry — voted to kill the measure, but just barely, 9-7. Wednesday’s House votes were even closer. A motion to kill it there failed, but only by three votes, 174-177. Then a motion to refer it back to committee failed, but only after House Speaker Terie Norelli tied it up by voting against it.