Payday Lenders Lobby for Loophole in Regulation

USA Today
April 20, 2010
Schouten, Fredreka

As Congress considers financial regulatory reform legislation, payday lenders have beefed up lobbying efforts in a bid to ensure their exemption from the bill. The version passed by the House would subject payday lenders to enforcement efforts under a proposed consumer protection body, but they would be somewhat insulated under the Senate version of the bill. Lobbying expenditures by the Community Financial Services Association surged 75 percent to $2.6 million last year, and the Online Lenders Alliance has held numerous fundraisers for lawmakers. Payday lenders insist their short-term loans did not play a role in the financial crisis; but the Center for Responsible Lending and other critics are concerned about the annual interest rates imposed by these companies, which often top 400 percent. While Congress continues to debate the measure, numerous states -- including Washington and Arizona -- have passed their own measures to enhance regulation of payday lenders.
Web Link