For immediate release
January 31, 2014
Groups in Four Key States Applaud End of Bank Payday Lending
Groups in four key banking states celebrated the end of bank payday lending, with the wave of announcements in recent weeks by Wells Fargo, US Bank, Fifth Third, and Regions Bank that they will each finally stop making predatory payday loans. Known as “direct deposit advance” loans, the banks’ payday loans carried triple-digit interest rates and trapped lower income borrowers in a damaging cycle of debt.
The banks’ announcements came in response to increasing public outrage, and followed the issuance of strong guidance by federal regulators. The end of bank payday lending constitutes a major victory for California Reinvestment Coalition, New Economy Project (NY), Reinvestment Partners (NC), Woodstock Institute (IL), and all the groups around the country that have long fought to end payday lending.
The four groups issued a report in June 2013, “The Case for Banning Payday Lending: Snapshots from Four Key States,” calling on state and federal regulators to crack down on all forms of predatory lending and other financial practices that strip wealth from low-income families and communities, particularly families and communities of color.
California Reinvestment Coalition advocates for fair and equal access to banking and other financial services for California’s low–income communities and communities of color. CRC has a membership of close to 300 nonprofit organizations and public agencies across the state of California. New Economy Project (formerly NEDAP) works with community groups in New York City to build an economy that works for all. Reinvestment Partners advocates for economic justice and opportunity. Woodstock Institute is a leading nonprofit research and policy organization in the areas of fair lending, wealth creation, and financial systems reform.
For more information, contact:
California Reinvestment Coalition: Paulina Gonzalez and Liana Molina, 415-864-3980
New Economy Project: Sarah Ludwig, 212-680-5100
Reinvestment Partners: Peter Skillern, 919-667-1000
Woodstock Institute: Courtney Eccles, 312-368-0310