LM: So tell us about the Fairness to Payday Lenders Society?

JS: As you know, there are 25,000 storefronts in the USA, and about half are independently owned and operated. The Community Financial Services Association, as well as FiSCA, and state-run payday loan associations are doing an outstanding job advocating for us. We just figured an informal group making calls to local government officials would supplement it all.

LM: How many entities are part of the Society?

JS: A few dozen.

LM: In what states?

JS: We have members all over the country, but we’ve tried to keep a low profile. Because we don’t have the resources that the big chains do, we are fearful of being persecuted by local consumer advocates, or being unfairly targeted by regulatory authorities that are unfriendly to us.

LM: As the Ohio DFI is doing?

JS: Exactly. They are clearly overstepping their authority, issuing enforcement actions against the smaller players that are operating well within the statutes. Yet because they don’t have the big lawyers or money to hire them, they are obviously being targeted.

LM: And the media doesn’t help.

JS: The media, always on the hunt for a sensational story, finds it better to focus on the small number of irresponsible borrowers – and a few lenders, too – rather than on how often the product helps people. As you know, about 154 million transactions occurred last year in the sector. Yet there were how many complaints to all the state regulatory agencies combined? A few hundred? Maybe? That’s a satisfaction rate that far exceeds even the best made consumer products in history.

LM: And yet, we still see these ridiculous op-ed pieces on a regular basis.

JS: Those and the news reports on local television.

LM: What’s the biggest obstacles you face?

JS: You know, the truth is that I think a lot of people and a lot of organizations are just uneducated about payday loans. It’s easier to make an emotionally-driven, misleading case against the product –

LM: The “triple digit interest rates” –

JS: Yes. It’s easier to toss that out there and get everyone riled up, then to take the time to explain exactly what short-term credit is, how badly it is needed, the costs to run it, and the economics behind it. If you’re a lobbyist, you have a few seconds to educate a neutral politician, whereas the opposing argument is so easy to make exactly because it is so false.

LM: In my dealings with opponents, I’ve found that 98% won’t even engage.

JS: Those are the ideologues. They are so driven by their own ideology that they don’t want to engage, or they’ll have to admit they’re wrong.

LM: Then you have the grandstanding politicians, which we distinguish between those who just haven’t confronted the issue before.

JS: They are the worst, because again, they’re disingenuous. They buy into the crap the Center for Responsible Lending sells because they see political gain to be made from it. Yet if they took the time to see how much payday loans help people, and how banning them hurts people, and came out in favor of the lenders – they’d look so much better.

LM: Power creates fear.

JS: It certainly does.

LM: So if you had a mission statement for the FTPLS, what would it be?

JS: To educate the media and politicians about payday loans.

LM: Take the time to listen and learn.

JS: Exactly. Anyone who wants information about payday loans can contact you, I’m sure. But they are welcome to contact me at bizmaven9@gmail.com .

Lawrence Meyers is President of PDL Capital and can be reached at pdlcapital@earthlink.net .

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