The Post and Courier had an interesting article today that called for greater restrictions to be placed on payday loans. The article claims that the recently passed bill is not harsh enough on payday loans.
Its mind boggling to continue to hear these petty arguments. The article cited “serial borrowers” who borrow a loan to simply pay off an outstanding one. They get caught in a debt trap and need to continually borrow more and eventually go bankrupt.
Or at least that is what they would have you believe. For ever “serial borrower” out there, I guarantee you there are 99 responsible borrowers. Is it the job of the payday lender to manage the finances of the borrower?
Payday lenders have natural protections in place already. Most will simply not lend more than 50% of a borrower’s income. This means they should easily be able to pay off the loan by the next paycheck. And if they mismanage their paychecks? Are payday lenders to blame?
You don’t outlaw the sale of knives because someone can hurt themselves. Why outlaw payday loans because some people are entirely too ignorant to figure them out? Could the literacy rate in America be to blame for foolish borrowing?
We again call on lawmakers in South Carolina to examine the facts about payday loans and not fall for this empty rhetoric. Payday loans serve a needed function in society.
