An update from Charleston’s The Digitel blog…

Details on the different bills passed in the House and the Senate.  Note the sidebar on the left side.

From the Associated Press: SC lawmakers approve payday lending regulation

South Carolina legislators gave overwhelming key approval to a bill aimed at preventing residents from being trapped in a cycle of debt through payday lending.

The proposal, approved 93-16 on Wednesday, prevents consumers from taking out more than one loan at a time, up to $600. An online database – which must be up by Feb. 1, 2010 – would instantly report when a loan is made. Lenders must check it to ensure customers don’t have outstanding loans elsewhere.

The AP gives a comprehensive overview of the current legislation in S.C. as well as next steps.

The Pundit would like to take this opportunity to convey his respect for Speaker of the S.C. House of Representatives, Bobby Harrell.  While he may have lead the charge on a new S.C. regulation on the payday lending industry, he also took a moment to profess respect for consumer choice, and for that I applaud him.  News and Press Online quotes Harrel:

“While there are some people who wanted to see us ban this industry or regulate it out of existence, clearly there is a demand from consumers for this particular service.”

Ah, such rationality and respect–it’s a breath of fresh air.

The Free Times is a free weekly in Columbia, S.C. I’ll grant you that the free weekly format lends itself to extended editorials masquerading as news, but their story on the payday lending industry would make it’s kissing cousin the unabashed East Bay Express blush.  Asserting facts with no attributions? 19 words out of almost 500 given to the industry–and a quote with no attribution at that?  Back to journalism school with Corey Hutchins! There we can only hope that the curriculum properly addresses citations, balanced reporting, and perhaps a seminar on how to listen critically to viewpoints that differ from one’s own.

From the blog post:

The free market regulators tried to bring this back from the dead, but it sounds like Harrell has effectively killed it for good this time, as it should be.   Payday lending is a  legitimate service and is needed by people when they are in a financial bind.  Sure, there are people who use it inappropriately and get caught up in debt because of it, but people do that with credit cards, loans, and every other kind of borrowing.  Payday lending services are no different.  Sure the interest rates are high, but people know what they are signing up for.  Legislators need to stop demonizing these legitimate services and start promoting self responsibility.

The windbag would be Warren Bolton, the obsessive compulsive payday lending foe who has written his 4,374th column on payday lending in today’s State Newspaper.  Compare Mr. Bolton’s smugness and self-righteousness to the sincerity of Ms. Linton’s column below.  The contrast is stark.

That would be Martha Linton, who has a terrific guest opinion piece today in the State Newspaper of South Carolina.  From the piece:

Several years ago, unforeseen family responsibilities sometimes required me to spend more money than I had at that moment. The banks would not tailor a small loan to meet my immediate need. I found out the hard way that credit cards and other “easy loan” offers are rip-offs with high interest rates and extra fees.

So I started doing business with payday lenders, by borrowing what I needed to get me to the next payday, a situation I never dreamed I would face.

I did not borrow more than I needed, and I always paid back the money. The transaction was simple and the terms understandable.

Thankfully, the responsibilities that required me to get short-term loans have passed, and I no longer am a regular customer, though I recently had to take out another loan, and I reserve the right to do so again if I choose.

The Payday Pundit doesn’t understand why lawmakers listen to out-of-touch fringe groups instead of hardworking, smart citizens like Martha Linton.  

“Payday lending bill is dead” says the headline from the State Newspaper.

State Rep. Harry Cato, R-Greenville, said he took umbrage at consumer advocates who criticized a House subcommittee that has not acted on the bill since it passed the state Senate on Feb. 19.

Cato, chairman of the House Commerce Committee, said a week ago that the bill would get a vote by May 20 or 21, when the banking subcommittee meets. He said he changed his mind after the AARP held a press conference Tuesday, criticizing the subcommittee for delaying the bill.