Big Banks believe in “payday like” Loans?
With so many consumers being really strapped for cash, and banks trying to find additional revenue, some banks are offering an alternative type of loan which appears to be like a payday loan. As we all know, payday loans are issued by payday lenders, not necessarily our local banks. However, Tennessee’s Fifth Third and U.S. Bank are offering 35 day payday advance loans. According to Nashville Business Journal, “The loans come with an annual percentage rate of 120 percent, or a 10 percent fee on money borrowed. That’s a rate much higher than almost any other form of credit, other than businesses that offer pawn, title or unsecured payday loans, which often charge fees as high as 400 percent APR.” So my question is, is this the beginning of banks now offering payday loans? Will they have to go through the same regulations as the payday lenders are having to go through?
Brick and mortar payday stores, online payday lenders and others that deal with payday loans are facing more and more regulations these days. Will our nation’s top 10 banks now be on that list of those being faced with the payday loan regulations?
Banks are doing what they can to get extra cash earn to pay back the bailout money they borrowed. All this talk with the law makers making rules and regulations for payday lenders, banks should really back off. Banks will be the next to be regulated, should they start expanding to payday loans. Or will law makers become more flexible with payday lenders?
The person looking for the loan should be aware that the possibility of them receiving a loan is only if they bank with that bank. Which means, they have full disclosure to your account and it will become more easy for them to garnish your account. The individual will not be able to overturn that withdraw since you are getting the payday loan from your bank.
1Fifth Third Bank has a sales quota for payday loans. If you have direct deposit you are eligible for the “service” . Employees are told to “go after” the poor with social security disability and the elderly on social security.
In addition to the 120% APR, in many instances the automatic repayment (whether the money is there or not) causes an expensive series of overdrafts. Instead of paying back 440.00 when including over draft fees these poor people end up paying several hundred dollars or more.
This is Tampa Bay’s predator banking at it’s finest!
2As a former employer of Tampa Bay FifthThird, everything in Kara’s email is precisely is expect of branch employees. They are told to pay attention to, and make lists of customers on social security disability and the elderly on small social security retirement pensions. These customers expected to be unable to repay in a timely fashion and when the auto repayment kicks in whether or not the money is in account; these poor people are charged hundreds or thousands of dollars in over draft fees and daily service fees. Ultimately they lose their accounts, are turned over to collection agencies with their credit ruined along with their emotional well being.
After 2 years I had Fifth Third’s predatory credit, lending practices, service fees etc., up to my back teeth. My core values represent honesty, integrity, responsibility – I was stunned and horrified by what I observed on a daily basis.
Fifth third bank is not the place for people with integrity. Over the last couple of years I’ve seen countless of colleagues get a belly full of Fifth Third and resign whether or not they’ve had another job lined up (like me). Yuck!
3Who reads papers when they have such a good blog to read. I was really asking myself on this subject so I went to Google, typed my question and voila, here I landed. Such a wonderful surprise to get to your site. Thank you for your time and for this wonderful post. Thank you smarte search engine for bringing me here.
So long!
4Thanks Perfume! We appreciate you reading our blog. Please feel free to keep checking back in.
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