Consumed by payday loans: State legislators offer haven for lenders deemed ‘predatory’, By Karen de Sá, October 30, 2011, San Jose Mercury News: “Facing government crackdowns around the country, payday lenders are thriving in lightly regulated California, where they lure hundreds of thousands of desperate borrowers a year despite punishing, triple-digit interest rates. Seventeen states and the U.S. military have effectively banned payday loans, which attract low-income borrowers who need a cash advance on paychecks. Georgia has declared payday lending to be felony racketeering. But in California, payday storefronts outnumber Starbucks coffeehouses. Neon-splashed businesses touting slogans like ‘Cash as Easy as 1, 2, 3!’ promise hassle-free, short-term loans, while few borrowers heed the fine print: A two-week loan will saddle them with what amounts to an annual interest rate of 460 percent. Now, the multibillion-dollar industry is looking for more help from a state Legislature that has protected payday lenders for years…”
Poverty-related issues in the news, from the Institute for Research on Poverty