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Fast Cash Payday Loans



I have a number of friends who don’t use banks at all. One of them only uses those check-cashing places, and has one which he goes to on a regular basis. I’ve talked to him about it a few times and I find the whole thing very interesting, but I guess I still don’t see why he thinks having a regular account at a check-cashing/payday loan place is somehow superior to having a regular bank.

As near as I can tell, your transactions are still pretty damned traceable on account of identity verification processes that those places go through. And the fees that you accrue through using them can equal or easily surpass what you would be charged at a bank.

A commenter on this site left an interesting tidbit on another post as well, which points to how heavily those check-cashing and payday loan fast cash places take advantage of immigrant populations, as well as minorities who can’t easily get loans:

I work with a guy from Uruguay. He thinks easy credit and loans (available thanks the Fed) is a great thing. In Uruguay it is very difficult to get a loan (capital) to start a new enterprise or business.

What we in effect have is a huge influx of people who have no frame of reference to tell them necessarily just how shitty and outrageous some of those places financial policies can be. I’ve seen signs at some of those places saying that they can charge up to 500% interest on a short-term loan which is not paid off in time. And because people are coming from even worse financial backgrounds than this, they are being taught to think of these terms as totally normal. This strikes me as incredibly dangerous!

{See also: Lombard Banking, Pawnbroking, Usury, Cherry Credits, Russell Simmons’ RushCard}







2 Reader Responses

  1. Tim Boucher Says:
    October 17th, 2007 at 3:31 pm

    Article on Russell Simmon’s RushCard:

    http://www.sfgate.com/cgi-bin/article....19/BUG578QH9N1.DTL&type=business

    In response, card advocates say that they’re cheaper than check-cashing places or than paying the stiff fees for bounced checks, and that many of the prepaid card customers don’t have alternatives because their financial history is littered with unpaid bills and bounced checks.

    Hefty fees

    The RushCard costs $19.95 to set up. There’s a $1 fee every time the customer makes a purchase or writes a check; each ATM withdrawal costs $1.50 plus the fee — usually $1 to $2 — charged by the bank that owns the ATM.

    Monthly fees to UniRush are capped at $10, but ATM surcharges to banks can add several dollars to that.

    While direct deposit is free, customers who don’t have steady paychecks can pay MoneyGram $6 or $7 to add funds to their account. UniRush said it hopes to sign up loading facilities that will charge $3 or $4 to put money in RushCard accounts.

    “These cards can be a convenient transition between the cash economy and the banking system,” said Gail Hillebrand, senior attorney with Consumers Union in San Francisco. “But generally, they cost more than a bank account. The fees appear to be higher than they need to be.

    “The key is, if you’re going to use one of these cards, go online or make some phone calls and ask about all the different fees. Add them up to see what is the best benefit for you.”

    Simmons is connected to self-proclaimed prophet, E. Bernard Jordan who preaches a prosperity gospel:

    http://en.wikipedia.org/wiki/Bishop_E._Bernard_Jordan
    http://en.wikipedia.org/wiki/Prosperity_gospel
    http://en.wikipedia.org/wiki/Word_of_Faith

    (Which starts to sound like Universalism, which I’ve written about a lot on this site)

  2. Tim Boucher Says:
    October 17th, 2007 at 3:33 pm

    This bit on Lombard Banking is also worthwhile:

    http://en.wikipedia.org/wiki/Lombard_banking

    Lombard banking refers to the historical use of the term ‘Lombard’ for a pawn shop in the Middle ages, a type of banking that originated with the prosperous northern Italian region of Lombardy (hence the name).

    The term was sometimes used in a derogatory sense as townspeople often accused lombards of usury. The lombards were never very popular for this reason and often had trouble with local governments. They were careful to write down all of the terms of contracts, to protect themselves, but that was no guarantee for success in times when few others could read and write, including local leaders.

    There is also a Lombard street in Baltimore:

    In 1492 Ferdinand and Isabella of Spain signed a decree expelling all Jews who refused to be converted to Christianity. A considerable number moved into Portugal. Many members of the migrant Jewish community in Portugal proceeded to become wealthy in commercially successful Portuguese port cities. Being forced on the move, Jewish families remained mobile and quickly developed international family agencies for growing brokerage houses involved with shipping. Such family networks of mobile Jewish “lombards” migrated from port city to city with the Spanish Inquisition and created international networks. In France the Lombards became synonymous with the Cahorsins. Most European cities still have a street named Lombard street after the pawn shop that once housed there. In Dutch, the name for a pawn shop is still lommerd, and the same etymology persists in the names of various banks (unless named after some family). In Polish, a pawn shop is called simply lombard.



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