Who thinks payday loan companies should be banned in every state?

I think they should be tightly regulated because they take advantage of people who are desperate and get caught up in the vicious cycle of fees and not being able to pay off the loan. People with poor credit or who cannot get regular credit have emergencies too. That's no reason to saddle them with the high fees that they charge.

Who knows, if their rates/fees were more reasonable, they could attract more customers. That's my opinion. After getting caught in this vicious cycle, I will NEVER take out a payday loan again. I've started cutting back on unnecesary spending, taking my lunch/coffee to work, and combining all my errands in one day/trip; clipping coupons and buying necessities only when they are on sale. Cut back on my cell phone where I only pay $10.99 a month, and cut back on using air conditioner/dishwasher at home. Every little bits counts. Don't mean to sound like I'm preaching, but my lack of oversight on my spending contributed to my needing payday loan when car repairs came up unexpectedly.

NO MORE PAYDAY HELL FOR ME! Learned my lesson the hard way.

The million dollar question is...

What is a resonable fee?

Is it an amount that is so small that a business cannot afford to keep the door open while providing the product in demand. This is exactly what some want when they say that PDL's should be capped at 36%. There is no way to offer the PDL at that APR. The result is that stores close, the ones that remain morph to another more complicated product that achieves similar results or the consumer moves to the more expensive, unregulated world of the internet.

A realistic fees to maintain a viable product for the lender and borrower is $15 per $100. This allows for the simplicity of a PDL to remain by offering the ability for the product to remain unchanged. Also, by creating a consistent fee nationwide and allowing for all states to offer the product, it will reduce the need for the consumer to go to the internet. If a storefront or even a licensed internet lender can offer a loan at $15 per $100, why would the consumer accept terms of $30 per $100. By creating consistent guidelines for the industry, there can be a licensing process and annual renewal to generate revenue to support the oversight of regulations and provide a financial literacy program for those in need.

Eliminating the legal lenders will not help the situation, only mask it by driving the consumer "underground". As for regulations, I operate in 2 states and have specific regulations on how I can do business and audits to ensure compliance. Before Istarted my own business, I had been responsible for stores in 8 other states with thier own regulations, compliance and auditing processes.

If not banned completely, then there should be EXTREMELY tight regulations. The problem with that, if you allow them to stay open under tight regs, then the PDL's will say they need to charge more to continue to operate, and next thing you know, they're right back where they were. There needs to be strict control because these companies target the very people who cannot afford to get caught in the PDL trap. I mean, how many storefront PDls do you see in the "better" parts of town? I'd bet not very many. That's why I'm appalled that so many of the PDL's use Indian tribal lands as their address; we hear so much about poverty, etc., in these places, I'm willing to bet that many PDL victims actually live on these lands. No easy answers but I'm with panddmccarthy, no more PDLs' for me.

I am not sure where you are located, but a true PDL store is generally located in high volume retail areas. Typically, we look for a Wal-Mart/K-Mart/Target type anchor and/or a strip center that is in a high visability location. Generally, PDL's do not serve low income areas since most residents of the extremely low income do not meet the requirements to borrow, a checking account and a valid form of income.

I believe that what you are referring to as a PDL business is actually a Check Cashier. Thier primary business is to cash various checks, sell money orders, accept utility bill payments, ect. They are sorely needed in low income neighborhoods due to the lack of traditional banks serving the area.

While there are many that do both types of business, you will find that the "core" business will be dictated by the location. PDL's will be the core in the middle income areas and check cashing will be the core in low income areas.

You bring up the tribal aspect, well they fall directly on top of the unlicensed, unregulated internet companies. They will only get worse if you remove the legal options!!! The "cure" will be much worse than the "medicine"!!!

BTW, congrats on being PDL free.

I think they are a bunch of loan sharks because they are not regulated enough. If they are not going to tighten up on what they are allowed to charge, then yes they should be banned.

I think the main problem is with all the illegal ones doing business!!! If they are illegal why are they not having to answer to someone??? Seems like they can just do whatever they want, to who they want , and nothing ever happens.

Here is an example for you, I open up a night club. I serve liquor but I did not get a license. BAM!!! Here comes the liquor control agent and closes me down, and fines me. If the illegal PDLs do not have a license why are they not shut down and fined????

You have just asnwered your own question in a sense. The need for regulation is to be able to "police" the industry and control the means in which it operates. If you eliminate the business legally, you create a form of prohabition. Just as what happened in the early 1900's, it goes underground and avoids the authorities, that is where the internet comes in to play. Just as it was difficult to find and eliminate the "speak easies", it is the same battle with the unlicensed internet lenders.

Elimination does not change the demand, just the supply.

I know the storefront PDLs are located in high VOLUME areas; however, my point is that you don't usually see them in the high INCOME areas of town. And yes, I realize the check cashing places are usually in poorer areas, but so are PDL's that I've seen in the past (as in DC). "Guest," as to why the illegal PDL's aren't shut down; one of the things I'd mentioned in my earlier post is that many of the ones who do business in the US locate their addresses on Indian tribal lands, which supposedly grants them immunity from State/Federal prosecution. Too, many of the online PDL's aren't even physically located in the US even though they might use US telephone numbers. One that I personally dealt with was physically located in the UK, their call bank was in India, and they used a Utah telephone number!

You must think about the customers and where they shop. There is no need for a PDL or check cashier in "high" income neighborhoods. The reason, people that frequent stores in an upscale area have other means credit available to them. Yes, you may see some PDL's in low income areas, but a vast majority of them locate in middle to upper middle income areas based on the fact that most customers of PDL's fall in the middle to upper middle income bracket. The median income for a customer is between $45,000 to $50,000.