Gee. The bankers don't want to give up charging 391% interest annually from desperate poor people who get hooked on payday loans. What a surprise!
Shawn Zeller at CQ Politics writes about the status of legislation to regulate the PayDay Loan Industry.
Payday loans are just a scam to fleece low-income workers when they get into financial difficulties, and for a large number of those workers, the loans become a major part of their financial difficulties. The lenders, of course, push the loans hardest at the most desperate and least savvy. That's where the profit is.
It's like the story of Budweiser Beer. The story some two decades ago was that 5% of their customers represented 50% of their business and their profits. That left Budweiser with the interesting strategic problem that they generated massive amounts of profit that they did not know how to invest. They were pikers compared to PayDay lenders.
We used to court-martial soldiers who practiced payday lending in the military. The government has limited the interest that can now be charged of soldiers to 36% per year. The rest of America needs the same consumer protections.