Oregon Governor Wants to Crack Down on Check Cashing, Payday Advance Services
By J.J. CameronPayday Loan Writer
It looks like Governor Ted Kulongoski may be listening to those who want to see regulations on payday loans and other industries that prey on consumers.
The governor said he'll propose a bill next year to limit charges by Oregon check-cashing services to 3 percent or $5, whichever is greater. Critics say check cashers' fees are unreasonably high and hit people who can least afford them, generally low-income residents without bank accounts.
"Charging working Oregonians a fee equal to 8 percent of their take-home pay just to cash paychecks is simply unacceptable," the governor said Tuesday in a statement for closing ceremonies of the state employees' food drive.
Luanna Stoltz, owner of a Portland cash advance company, said she was unsure how the governor's proposal would affect her limited check-cashing business. She cashed checks more as a service than moneymaker, she said. The Oregonian was unable to reach several other owners of check-cashing or payday loan stores.
Most activists and legislators concerned about financial exploitation of low-income residents are focused on regulating payday loan lenders, which charge high interest for short-term paycheck advances. Legislative leaders say they may try next week in the special session to adopt a bill to tighten controls over payday advance lenders.
Some supporters of such restrictions say they plan to turn next to fighting for caps on check-cashing fees. They also want to see more rules governing car-title lenders, who charge high interest for small short-term loans using car titles as collateral.
The payday loan lending business grew out of check cashing over the past decade. Many lenders still cash checks and make car-title loans. All of these services fall into the category of "predatory lending," said Rep. Jackie Dingfelder, D-Portland, who has long supported tighter regulations on payday lenders and backs Kulongoski's proposed crack down on check cashers.
April 15th, 2006 at 8:07 am
[…] Prozanski said prospects are good that they will settle on "some reasonable regulations." Gov. Ted Kulongoski and Democratic legislative leaders say they will settle for no payday reform law in the special session that is not at least as restrictive as the initiative. […]