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01/19/2014 07:23 PM
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Report Copyright Violation | Major Predatory Banks to Discontinue 300 FUCKING PERCENT APR Payday Loan Products Wells Fargo, U.S. Bank to end deposit advance loans, citing tougher regulation [ link to www.washingtonpost.com] ... Banks are abandoning these products amid intensifying scrutiny from regulators about their high costs and similarities to payday lending. As the majority of lenders offering these services leave the market, they risk losing the potential to generate $500 million in fees as customers seek alternative forms of short-term credit, according to 2010 estimates from Aite Group LLC.
“It’s obviously regulatory pressure strong-arming them, because it’s a product that consumers like and that banks want to offer,” said Todd Zywicki, a law professor at George Mason University in Fairfax, Virgina, who has researched payday lending and deposit advance. “The question is, what happens to these consumers?”... Wells Fargo, U.S. Bank to end deposit advance loans, citing tougher regulation [ link to www.washingtonpost.com] ... The big banks are the latest, following Regions Financial Corp. this week, to discontinue “deposit advance loans,” which are tied to consumers’ paychecks, government benefits or other income directly deposited into their bank accounts.
A number of advocacy groups have decried the products for carrying the same triple-digit interest rates and balloon payments as payday loans. Meanwhile, regulators have grown apprehensive about the safety and soundness risks posed by the loans.... Banks opt out of payday lending [ link to www.thecharlottepost.com] Regions Bank, Wells Fargo, US Bank and Fifth Third announced last week that they will discontinue payday loan products, which had interest rates that went as high as 300 percent a year. The announcements follow regulatory guidance finalized last year by ...... |
