Group calls for federal regulation of payday loans
BATON ROUGE - Clergy and community leaders with Together Louisiana announced plans for a press conference Wednesday to call for federal regulation of payday lending.
The members of Together Louisiana said they'll also meet with Richard Cordray, the Director of the Consumer Financial Protection Bureau, in New Orleans Thursday to present a plan that would bring payday lending under control.
Dianne Hanley, a leader with Together Louisiana, said the state legislature failed to address payday lending during their just-completed regular session. Hanley said payday lending harms hundreds of thousands of citizens each year, creating "debt traps" through quick loans and mounting interest rates.
A bill to cap payday lending in Louisiana died during the legislative session after opposition from the lending industry. Instead, a weaker bill that requires all lenders serving Louisiana residents to register with the Office of Financial Institutions made it to the governor's desk. The Center for American Racial Equality opposed that step, saying it would create a monopoly for in-state lenders by discouraging online competition, and asked Jindal to veto it.
The CFPB is expected to issue the first federal regulations aimed at governing payday lending in the next few months.