Greg Beato on the New Warm Fuzzy Payday Lenders
For more than two decades, America's bank deserts have been afflicted by convenient access to payday loans. As alluring as giant bottles of soda pop, this consumer-friendly form of credit may look refreshing, its critics contend, but it leaves a bitter aftertaste of misery and exploitation. Sometimes these critics have a point. Yet despite instances of egregious tactics--and despite persistent calls for stricter regulation of the industry--consumer demand for short-term, high-interest, uncollateralized credit remains strong. Entrepreneurial reform is happening across all sectors of the financial services industry, and, as Greg Beato writes in the December issue of Reason, a wave of consumer-oriented lending institutions is starting to hit critical mass.
