Letters to the Editor
Consumers’ financial needs best met with a variety of options, including regulated payday loans
The Colorado Statesman’s May 1 story on the Bank on Cities Campaign selecting Denver as one of eight cities participating in the program is good news for consumers, but was inaccurate in its reporting on payday loan consumers when it claimed the program will provide greater financial stability for residents who “spend millions of dollars a year on payday loan fees because they don’t have bank accounts” (“Program offers escape from payday loans”).
One hundred percent of payday loan customers are banked. In order to obtain a payday advance, a customer must have a checking account, a steady source of income and a verifiable form of identification. Payday lending has been a regulated credit option for Colorado consumers since 1994, providing reliable, short-term access to funds to help working Coloradans manage unexpected expenses.
In Colorado, payday loan amounts and fees are limited and transactions are strictly regulated by the State Attorney General’s Office. State regulator reports indicate more than 90 percent of payday loan
The members of the Colorado Financial Service Centers Association (COFiSCA), the state trade association representing payday lenders, are dedicated to delivering valuable community based financial services to under-served consumers throughout the State of Colorado.
The “Bank on Denver” program is designed to help individuals get checking and savings accounts as the important first step in building a strong financial future.
COFiSCA has long maintained that consumers are best served when they have access to a full range of choices in financial services and products as well as programs to help improve their financial literacy.
We support Mayor Hickenlooper’s goal of bringing financial services to more Denver residents through this program and applaud the efforts of the National League of Cities, the City and County of Denver, and others involved in this campaign.
We believe consumers’ financial needs are best served when they have the most options available to them. This initiative highlights the importance of expanding, not limiting, consumer access to financial services.
Ron Rockvam, President