SL County Council To Consider Payday Lender Ordinances
Apr 01, 2008 by Eric Ray
(KCPW News) As a six-month moratorium on new payday lending businesses in unincorporated Salt Lake County is set to expire, the County Council is considering several new ordinances that regulate the high interest loan practice."It's not the business of municipalities to regulate financial institutions. That's the business primarily of the federal government and secondarily of the state government. For some reason in this area, both the state government and the federal government are unwilling to act," says County Council Joe Hatch.
Hatch says county action is necessary because the Utah Legislature failed to impose regulations during this year's session. The county ordinance would require payday lenders to provide literature detailing how the loans work and the fees that go with them. The businesses would also be required to be at least 600 feet from another payday lender, and Hatch says they could possibly be capped at one for every 10,000 county residents. The actions of surrounding cities have made the ordinances necessary, adds Hatch.
"With cities surrounding unincorporated Salt Lake County, like Taylorsville and West Valley, putting strong restrictions on payday lenders and their numbers, that means that the unincorporated areas will become the magnets for these stores," says Hatch.
The County Council will hear Hatch's presentation of the ordinances during their meeting this afternoon. Formal adoption of the new regulations isn't expected to take place until next week.
Email to a friendPosted in KCPW Newsroom. Copyright 2008 KCPW
1. PaydayLendingrep said:
Payday lenders are located in population centers, convenient locations where customers live, work and shop. While critics of the industry assign labels to payday lending customers in an attempt to further their political agendas, the fact is that we provide services to a broad cross section of Americans because there is widespread demand for the financial service we provide. Our customers represent a broad demographic segment and cannot be grouped based on race, sex or religion.
Restricting access to payday loans as an option does not eliminate the need for short-term credit. Instead it forces consumers to choose between more expensive alternatives such as fees for bounced checks, overdraft protection, or late bill payments or even unregulated off-shore Internet lenders.
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