Payday lenders ease access to credit
Springfield News Leader
December 3, 2008
by: Tim Miller
Governor-elect Jay Nixon's desire to regulate the short-term payday lending industry does little to actually help Missourians ("Payday lending foes hopeful," Dec. 1, News-Leader).
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.
Two weeks ago, an article in the New York Times Magazine highlighted the difficulty of accessing consumer credit facing many Americans.
The article took a balanced look at the services offered by short-term payday lenders, finding that payday loans are a valuable financial tool since they offer easy-to-understand conditions, with “no surprises, no hidden fees,” (unlike many bank, which are offering these same kinds of loans but without being demonized by media and political elites).
On the heels of the Times article came a Dartmouth College study looking at a 2007 payday lending ban in Oregon. They concluded that banning financial options ended up hurting Oregon borrowers, and forced them to turn to inferior substitutes like bounced checks. Borrowers are best served when they have more choices to pick from.
Tim Miller
Center for Consumer Freedom, Washington, D.C.
