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Today's Other Paper contains a remarkably honest admission from a payday lender.Tom Dudte, owner of Ameribucks on Kenny Road, said the payday loan business is designed to set borrowers "up for failure."
Payday opponents have said that all along. They have insisted that the lenders maximize their profits by pressuring borrowers to take out multiple loans.
The lending lobby keeps insisting that's not the case.
Earlier this month, payday spokeswoman Kim Norris told the Toledo Blade that customers "come in, they take out a $100 loan, and they pay $15 on that loan. It's a short-term loan, and they pay it back in two weeks. That's what 90 percent of customers do."
What she doesn't tell you: Most of those customers pay off the first loan by taking out a second, larger loan. The interest and fees eventually hit a ridiculous level.
Mr. Dutde must not have received Ms. Norris' talking points because he admits in the Other Paper that lender profits are linked to repeat borrowing:
Dudte says his intention always was to help people, but the system was built to set people up for failure.
"If you don't have customers always re-borrowing, you're not going to make much money," he said.
If you did all these things, you wouldn't have to worry about predatory payday lending. There would be plenty of good paying jobs and the bottom feeders would for the most part disappear.
But will you do this? My sense is, no...you won't.
So until that happens, most of the bright young professionals and professionals-to-be will grow up, graduate from high school and college and simply leave the state for greener pastures.
Actually, we DO know what's wrong there. My wife and I and a lot of others know what's wrong and I've listed the problems above. There are simply too many of the wrong people in positions of power in the area bounded by I-71 and US 30.
Ohio is a business friendly state but NE Ohio has been walled off like a virus for years due to the influence of organized labor. That's why you have companies like Procter and Gamble in Cincinnati and Nationwide Insurance in Columbus and then you have complete abject urban poverty less than two hours away.
And, yes...Danville is a nice place. We've earned it.
I've been watching the hurricane maps and reading about how expensive it is to live in coastal cities, and Ohio is looking better and better all the time.
Please be specific: Name, address of business, and the person's name from the company you talked to.
Regardless of what their opponents say, it is one loan at a time for each of those companies.
We need to end this debt trap for Ohioans! Vote Yes on Issue 5!