Florida church leaders flock to support payday lenders
Inside Subprime: April 16, 2018
By Aubrey Sitler
Payday loans in Florida are about to change in a big way that favors payday lending companies, thanks to a new bill that was signed into law last month.
This new law will enable payday lenders in Florida to offer 90-day loans of up to $1000 with as much as $214 in fees, which is a stark increase from the prior standard that capped payday lending in Florida to 60-day repayments for a maximum of $500 in payday loans with total fees of up to $55.
Even at the old amount and rate limits, the Center for Responsible Lending found that in 2015, 83 percent of payday loans in Florida were made to people who already had seven or more outstanding payday loans, and they were most highly concentrated in black and Latino communities. Instead of seeking out legislation that would better protect consumers from predatory lending practices, now, consumers with bad credit who are seeking cash advances or no credit check loans in Florida will have an even easier time accessing more cash that could easily spiral them into an ongoing debt trap.
The law itself, which came out of SB 920 and was informally referred to as the Deferred Presentment Transactions bill, was first filed in the Florida Senate by co-sponsoring Senators Bradley (R) and Braynon (D) in November 2017 and flew through the legislative process with what appears to have been minimal pushback from lawmakers. The Florida Senate passed the bill with a 31-5 majority on March 3, 2018, and the Florida House passed it with a 106-9 majority on March 7. The Governor signed it into law on March 19. It is set to take effect on July 1, 2019.
Even more peculiar than the quick ascent this bill made through the legislature, though, were the ministers and pastors – all from black Democrats’ home districts – who were present to support it before the legislature. How did all of these religious leaders end up in Tallahassee at once to support this legislation that other community and religions leaders have ardently opposed? They were reportedly all flown in on private jets by Florida’s largest payday lending company, Amscot, in a strategic move that has been years in the making.
As reported by the Tampa Bay Times, bringing in these religious leaders appears to have been a strategic move to target a specific group of lawmakers: black Democrats, whose support was crucial to passing this legislation. Moreover, this move worked. Many of the religious leaders present for the bill’s hearings referred to Amscot as a “good corporate citizen” and, coincidentally, also noted that their churches have received contributions from the payday lending giant.
According to their website, Amscot and the family of founder and CEO Ian MacKechnie have contributed a combined $8.31 million in an undefined amount of time. The Tampa Bay Times reports that Amscot has donated at least $1.3 million to state politicians since the early 2000s. Both of these amounts of seem like pocket change in comparison to the over $2.5 billion (yes, BILLION) in fees alone that Floridians paid to all payday lenders between 2005 and 2015.
To learn more about payday lending in Florida and in other spots around the country, check out these related pages and articles from OppLoans:
- The Georgia Subprime Marketplace: Payday and Title Loans in Georgia
- Bad Credit Loans: A Last Resort
- Payday and Title Lending in Alabama