The House Commerce Committee on Wednesday rejected a push by the national payday lending industry to expand its Louisiana operations and make the debt trap deeper and longer for vulnerable borrowers. Witnesses testified to the harms payday lending already subjects Louisiana families to, as well as the availability of much cheaper and less harmful alternatives.
“We applaud the nine committee members who voted against Senate Bill 365 for standing with the people of Louisiana and against predatory lenders who trap hardworking people in debt they can’t afford,” said Carmen Green, State Policy Fellow of the Louisiana Budget Project. “Payday lending is not the short-term cushion that their lobbyists make it out to be; it is set up to milk people for the cash they need to keep their families going.”
The bill was opposed by a broad array of organizations including the Louisiana Conference of Catholic Bishops, the United Way of Southeast Louisiana, the credit union industry and even local payday lenders. Fourteen groups signed an open letter to Louisiana legislators urging their opposition to the bill, including the Louisiana NAACP, faith groups, and advocates for low-income families.
“Payday lenders will try to tell you our communities need these loans. We don’t. We need safe, responsible resources for people who are struggling to make it, not debt traps disguised as short-term relief, but that actually confiscate big chunks of their customers’ wages over weeks, months and even years,” said Byron Sharper, President of the Baton Rouge chapter of the Louisiana NAACP. “Payday lenders are known to target communities of color in particular, so the NAACP has long opposed this predatory business model.”
For more information about Senate Bill 365, click here.