Credit unions are disagreeing with claims that they will directly benefit from a new bill that’s written to crack down on the payday lending industry. As the credit unions argue, they’re already operating from a different, tough set of rules.
Payday lenders have claimed the Senate’s version of the payday lending crackdown would create an unlevel playing field.
But Emily Leite with the Ohio Credit Union League said they’re exempted from the bill because they already work under a different section of code. Leity added that strong consumer protections create a positive ripple effect.
“So if folks in communities are financially healthy, you’ll start to see local communities blossoming," she said. "You’ll start to see stronger job creation opportunities crop up in those communities, having a handle on your finances and in control of that will help lead to all those other things."
The payday lending industry complains that credit unions benefit from membership fees and overdraft charges, but credit unions counter that interest rates and fees can be much higher for payday lenders.