There are more payday loan stores in the U.S. than all the McDonald’s and Starbucks stores combined. It’s clear that tens of millions of consumers across the nation want and feel they need this product. It’s equally clear that government policymakers believe they know what’s best for consumers.
Recent actions taken by the federal government to eliminate a variety of short-term loan products suggest a strong bias against all such loans – period. If so, regulators need to reconsider before they destroy a critical source of credit for families and the economy as a whole.
I want to make a couple of things clear before proceeding. Until April when I reach mandatory board retirement age, I am chairman of Fifth Third Bancorp, which is one of four large banking companies to recently abandon very popular short-term lending products in response to regulatory pressure. Also, my consulting firm has done regulatory compliance work for one or more payday lending firms. I’m not speaking for those companies.Posted: Feb 21, 2014