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OKLAHOMA CITY – Some religious leaders in Oklahoma are working to defeat a bill they say gives payday loan companies more authority.
The federal government is preparing to adopt more stringent standards for these types of businesses.
Before that happened, their lobbyists reached out to state lawmakers across the country, trying to get legislation that would allow them to offer a wider range of products.
Some say this is not good news for the Oklahoman.
“We must bring good news to the poor. Payday loans are not good news for the poor. This is the worst news possible, ”said Pastor Mitch Randall of New Haven Church in Norman.
Pastor Randall is one of a group of religious leaders who have spoken out against SB 1314.
The bill would allow payday loan companies to lend up to $ 3,000 at a time, instead of just $ 500.
“They are making money off the backs of the poorest citizens of our state and that is immoral. It’s wrong and they have to go out of business, ”Randall said.
“The predatory loan is a debt trap. They are, they are looking for those who are most vulnerable, ”said Jill Hatcher, whose husband is pastor at First Baptist Church in Norman.
The Oklahoma Policy Institute has also spoken out against the bill, saying it would allow lenders to charge up to 20% monthly interest.
On a loan of $ 3,000, that would represent $ 600 per month in interest and fees.
“It’s crazy. I wouldn’t take a 240% APR loan, would I?” Hatcher said.
Senator David Holt drafted the bill.
“I’m not sure the government is the place to protect people from themselves. I think it can be more of a role for churches, ”Senator Holt said.
Holt says that while he doesn’t necessarily think payday loans are a great option, he believes in the free market and offers different options to consumers; as long as there are adequate disclosures.
“If it’s a really bad financial product for people, I would like to think they won’t look for it. And we, as a government, don’t have to tell them that. That they’ll just go somewhere else, ”Holt said.
Opponents say they will work to defeat the bill, possibly replacing it with one that would drive these companies out of our state.
“It is an evil practice,” said Pastor Randall.
Jamie Fulmer, Senior Vice President of Public Affairs for Advance America, Cash Advance Center, Inc. sent us this statement.
“Hard-working Oklahomans appreciate the flexibility, simplicity and reliability of regulated short-term credit products, which enjoy high customer satisfaction. Consumers are best served when they have access to a wide variety of choices and when their local leaders promote a well-regulated and transparent market. Senate Bill 1314 would do just that, providing borrowers with affordable and accessible credit tailored to their needs. “
The bill was passed by committee last week and will likely go to the full Senate in a few weeks.
Update: Senator David Holt tweeted that he will not advance this controversial bill.
He did so after suffering negative reactions on social media.
Any call for a less regulated economy still attracts me as a champion of the free market, but I will not push SB 1314 (flexible loans) forward.
– Mayor David Holt (@davidfholt) February 23, 2016
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