A lot of discussion has occurred in Utah lately around the subject of Payday Lenders and the onerous interest rates that they charged. I like the simple solution that was given to the problem in a recent letter to the editor. In 1994, Utah had about 20 paycheck-cashing lenders. Now there are about 400 of these "payday lenders" in Utah . They cater predominantly to poor and Hispanics. Up until 20 years ago, Utah had established upper limits as to what lenders could charge. In the absence of such limits today, average interest rates charged by payday lenders in Utah are 521%, with some as high as 900%. A recent letter to the editor of the Deseret News suggests that the state should require these lenders, like all others, to post their interest rates for all to see. I agree. A statement by the Utah Consumer Lending Association blames such high interest rates on strict Utah regulations: A senior economist with the Federal Reserve in Manhattan has just concluded a report (1...
Politics is seldom simple. But the truth usually is.