SPRINGFIELD, Mo. — A short-term lending ordinance passed after going through several versions and being tabled for years.
Susan Schmalzbauer, of Faith Voices of Southwest Missouri, calls this an important first step.
“So part of this ordinance requires the lenders to post in language that folks can understand what is the true cost of the loan,” said Schmalzbauer. “You know this is about exploiting people, exploiting folks that backs are against the wall.”
The ordinance will also require lenders to provide information on alternative places to get loans, but there is concern of if it will be enough to stop so called predatory spending.
“I do want to say I harbor no illusion that our vote tonight will impact the payday lending industry in any significant way,” said Andrew Lear, Springfield city councilman. “We know that any true reform will require action at the state level.”
KOLR10 reached out to several payday loan compainies, but none returned our calls.
Megan Short, one who spoke out against the ordinance at city council, said she doesn’t support short term lending but advised city council last year that it’s a slippery slope if we require fees for just one industry.
“People aren’t always happy with every individual industry on a day in day out basis,” said Short. “The people that use these. They just need to be able to get the money right then. Whether they don’t have the best credit or they can’t wait for a loan to process. There’s a void right now and that’s why people use them. We’re not able to stop that by just charging a fee.”
Faith Voices of Southwest Missouri says its continuing the fight by calling for a 36% interest cap on payday loans, similar to regulations on credit card companies.
You’ll be able to say yes or no to the ordinance on August 4.