DNC head challenged by faith leaders over exploitative payday lending

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Several Cooperative Baptist Fellowship ministers were among 36 faith leaders sending an open letter March 17 taking the chair of the Democratic National Committee to task for resisting attempts by the Obama administration to rein in abuses in payday lending.

The clergy asked Rep. Debbie Wasserman Schultz (D-Fla.) to support rules being drafted by the Consumer Financial Protection Bureau to crack down on abusive payday lending.

“The Bible expressly forbids excessive interest and warns us not to ‘exploit the poor because they are poor’ (Proverbs 22:22),” the faith leaders said. “With its average 400 percent interest rate, payday lending is the very definition of exploitation.”

The clergy said exploiting the poor is “the very business model” of payday lending, in which money is made by lending amounts that a borrower cannot pay back in time unless they take out another loan, and then another, and so forth.

“Each loan comes with an astronomical interest rate that eats an ever‐bigger hole in the borrower’s budget,” they said. “We call this the debt trap. It is intentional. It is not moral. It should not be legal.”

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https://baptistnews.com/2016/03/18/dnc-head-challenged-by-faith-leaders-over-exploitative-payday-lending/