The May 27 letter "A Payday Loan Trap" by Rev. Paul L. Lubold attempted to make the case that lawmakers in Harrisburg should ignore the needs of 300,000 Pennsylvania families by ending efforts to reform the state's short-term credit industry.
This letter, submitted as part of a statewide effort by Philadelphia-based taxpayer-funded lobbying groups opposing reform, was both factually inaccurate and completely ignored the purpose of reforming the industry to protect these 300,000 families from predatory lending.
Here are the facts.
State Sen. Pat Browne recently introduced legislation that would cap interest rates, restrict fees, end rollovers and balloon payments, and finally bring common-sense regulation to the short-term credit industry in Pennsylvania. The bill also includes critical consumer protections for both veterans and active duty military that do not currently exist in state law.
In addition, the Browne legislation creates a three-tiered short-term credit system that allows these families to not just break the cycle of debt but also to earn their way to better credit and regain their financial footing.
This legislation represents the first opportunity in recent memory to both regulate an unchecked industry and give these families access to a safe, affordable alternative to the predatory lending practices of black market online lenders, offshore credit companies and loan sharks.
These families deserve the opportunity to rebuild their credit and do so in a safe, affordable way, and the Browne bill represents the best opportunity for these families to do just that.
Lawmakers need to move quickly and pass the Browne reform bill to help these families build a strong financial future.
Pennsylvania Consumer Credit Association