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Nader Praises CDCUs' Efforts Against Pay Day Lending

NEW YORK - Third Party Presidential candidate Ralph Nader has decried payday lending in an article and praised community development credit unions' efforts against the high interest lending. Nader's article, written for In the Public Interest and published electronically by ProgressiveTrail.Org, claims that payday loan outlets have almost doubled in...

By Staff Writer | Updated on August 03, 2004

NEW YORK – Third Party Presidential candidate Ralph Nader has decried payday lending in an article and praised community development credit unions’ efforts against the high interest lending. Nader’s article, written for In the Public Interest and published electronically by ProgressiveTrail.Org, claims that payday loan outlets have almost doubled in the past four years, from 12,000 in the year 2000, up to 22,000. Nader cites industry statistics of $40 billion loans made in 2003 generating $6 billion in revenue. “On average,” writes Nader, “payday lenders charge interest rates of 390 percent.” “The hard truth,” Nader writes, “is that banks with few exceptions don’t make small consumer loans, of the $200 or $500 or even the $1,000 and $2,000 variety,” leaving the field open to high-cost predatory lenders. Cliff Rosenthal said that while the famous consumer advocate and candidate was off in some credit union details in the piece, CDCUs were nonetheless working hard in the field helping their members avoid these loans. The Federation recently unveiled a grant program that will help CDCUs test new payday loan alternative products.

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