St. Paddy's Day may be a time to drink beers and fill out your tournament bracket, but it's also a time to dress up like a leprechaun or a loan shark and protest predatory lending. A group called the Alliance to Prevent Predatory Lending will be holding two events at the state capitol today to call for tighter regulation of pay-day lenders. (On a related note, read Laura Onstot's revisionist profile of industry leader Money Tree--whose iconic caterpillar is pictured below.)
"People end up in a trap of having to borrow repeatedly," says Charla Neuman, a spokesperson for APPL. Most people can't manage to pay off a loan by the next payday, she says, so they end up taking out more loans--sometimes up to 50 a year.
Payday lenders regularly oppose limits on their lending, arguing that their margins are
small and that the limits would put them out of business. Neuman says she's not concerned about that, noting that several credit unions--most notably Watermark--have begun offering payday loans, and arguing that states that have eliminated payday lenders have done well. North Carolina and Georgia have gotten rid of payday lending altogether. A New York Federal Reserve researcher says the effects have been bad. The University of North Carolina says they've been good (pdf).
Details on the events:
What: Rally including speaker Danielle Friedman, campaign manager for Alliance to Prevent Predatory Lending
When: Payday lending advocates speak at 12:30 p.m. (rally is from 11am to 1pm)
Where: Trivoli Fountain on the Capitol grounds in Olympia
What: Advocates, leprechauns and loan sharks push for payday lending reforms
When: 2:00 p.m.
Where: Sundial in front of Pritchard building, between the legislative buildings