First there was HB2191 in 2012, followed by SB975 in 2013, and now Senator Jake Corman is soliciting his colleagues for co-sponsorship of a bill that would create a “90 Day Consumer Loan Program”. With short term lending products the devil is always in the details and we don’t yet have the language of the bill.
Absent more information on the features of this new product the coalition to stop predatory payday loans in Pennsylvania is urging members of the Senate to decline co-sponsorship until the full terms of Senator Corman’s proposal can be analyzed.
What low-income consumers in Pennsylvania need is more income, not another vehicle for predatory lenders to trap them in a cycle debt that ultimately ends in bankruptcy.
The Pennsylvania legislature has the capacity, through setting a higher minimum wage to boost the incomes of over a million low wage workers. Doing so will boost the economy by providing more working families with income to spend on the basics like food, doctor visits or necessary repairs.
Allowing payday lending companies to lure financially unsophisticated borrowers into debt products has the opposite effect. Money that would have gone to pay for rent, medical bills and groceries is eaten up by high fees sapping the local economy.