Amen on this commentary!!! Those who rail against the payday loan industry should step up to the plate and loan their own money to people with little to no credit history and sketchy job histories. These are short term loans people!. Of course the interest is going to equate to ridiculous rates – if it is being carried for an entire year. Kudos to Calvin and the Show-Me-Institute!

By Calvin Harris II

The nation’s current economic crisis has made it difficult for even dependable borrowers to get credit. Recognizing that some people facing their own fiscal challenges may find quick-fix options to be attractive, the Saint Louis Board of Aldermen is debating a proposal that would restrict the opening of new payday loan firms and check cashing operations near schools and residential areas throughout the city. The plan would also prohibit new stores from opening near existing operations of this type.

While it might be argued that the proposed limits would prevent low-income people from worsening their financial woes, this type of one-size-fits-all regulation fails to account for the many diverse needs of people dealing with different kinds of financial trouble.

Payday loans are advances intended to cover borrowers’ short term expenses until their next paycheck. While the number of payday loan sites around Saint Louis has decreased, both in the city and around the county, the stores remain ever-present in areas where residents are the most financially vulnerable. Payday lenders focus on marketing their services to consumers who have little access to traditional forms of credit. In the state of Missouri, the fees and interest charged by such lenders ranges from 422 percent to as high as 1,950 percent. Read more…

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