Payday Lenders and Check Cashers Fight Financial Reform Legislation in Congress

Washington Post
May 10, 2010
Mui, Ylan Q.
P. A4

While Democrats were launching a new initiative to limit the number of payday loans a consumer can take out, the Financial Service Centers of America (FiSCA) -- a group of 40 payday check cashing executives -- was petitioning for removal of its members from the purview of the proposed consumer financial protection agency. The financial reform bill could bring payday lenders and check cashers under the scrutiny of a federal watchdog for the first time, but industry executives are arguing that they are already under a complex system of state legislation. FiSCA held a similar "Hill Blitz" in January and is joined by the Community Financial Services Association, a group consisting solely of payday lending executives, which has increased its spending on lobbying by 75 percent since 2008 and recruited customers to write letters to representatives. The Treasury Department and the Obama administration oppose excluding any financial firms from the agency's oversight. "The consumer financial protection bureau needs to be able to require companies to provide clear, understandable information so that Americans can make financial decisions that work best for them," according to a Treasury statement. Additionally, the industries are coming up against the renewed fight against payday lending, found in efforts like Sen. Kay Hagan's (D-N.C.) amendment that would limit the number of payday loans available to an individual borrower in one year.
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