By The Tribune-Review
Published: Tuesday, June 25, 2013, 9:00 p.m.
Frederic Ozanam, Society of St. Vincent de Paul founder, stated: “Charity is the Samaritan who pours oil on the wounds of the traveler who has been attacked. It is Justice's role to prevent the attacks!”
Joseph Sabino Mistick's column “The payday Trojan horse” (June 16 and TribLIVE.com) does an excellent job calling for our state senators to prevent greedy, exploitative attacks on vulnerable Pennsylvanians.
Billed as “consumer protection,” Senate Bill 975 would legalize predatory loans at 300-percent and higher annual interest rates. Rather than protecting consumers, it would roll back prohibitions on usurious lending in place for more than a century.
In states that allow such payday-loan interest, the typical borrower pays back $700 on a $300 loan. A U.S. Department of Defense report on payday lending found “this debt trap is the rule, not the exception.”
Payday lending is modern-day usury, exploiting borrowers facing financial emergencies. The lender's excessive profit fails to offer the borrower a sustainable solution.
Borrowers are rarely able to pay down the principal and typically fall deeper into debt. Rather than offering a bridge to financial security, payday loans make financial problems worse, leading to increased food-stamp usage, delinquency on bills, utility shutoffs and, eventually, bankruptcy.
Today, Pennsylvania's laws are considered among the country's strongest to protect against this abusive lending. Please contact your state senator immediately to express your strongest opposition to this bill. For more information, visit stoppaydayloanspa.com .
Keith G. Kondrich
The writer is executive director of the Society of St. Vincent de Paul, Council of Pittsburgh (svdppitt.org).
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