Governor Newsom Rebukes Predatory Lenders in Inauguration Address

OAKLAND, CALIF. – In his inauguration speech earlier today, Governor Gavin Newsom criticized abusive payday lenders as special interest who target California’s most vulnerable populations, “…Polluters who threaten our coastline and pay-day lenders who target our most vulnerable…interests like these still have a tight grip on power. But here in California, we have the power to stand up to them – and we will.”

CRL has consistently fought against predatory lending practices across California, including abusive payday lenders. Previously, CRL announced that a DBO research report detailed how payday loan stores in the state are disproportionately located in heavily African American and Latino neighborhoods. Combined, African Americans and Latinos make up almost 44% of the state's total population--and in those communities, on average, nearly 60% had six or more payday loan stores compared to white communities at 28%. DBO's research reflects a CRL study that shows even after controlling for income and a variety of other factors, payday lenders are 2.4 times more concentrated in African American and Latino communities.

CRL California Policy Director Graciela Aponte-Diaz released the following statement:

It’s reassuring to see Governor Newsom’s commitment to tackling predatory lending in California. Payday lenders' business model depends on trapping people in triple digit interest rate loans. These products have severe financial consequences on low-wealth families across the state, including seniors who often live on fixed incomes such as social security, disability, or VA benefits. Payday lenders are also notorious for targeting consumers of color, which widens the racial wealth gap within our communities. We look forward to working with the Governor and State Legislature to pass meaningful and commonsense laws that protect California families from these predatory loan sharks.

For more information, or to arrange an interview with a CRL spokesperson on this issue, please contact Ricardo Quinto at ricardo.quinto@responsiblelending.org.