Arizona Payday Lenders Now Out of Business June 30
Barring any last minute switch by Arizona lawmakers, the state's payday lenders will be closed effective June 30.
"It's never over until the legislature adjourns, but many people are now saying the firms will be out of the lending business and converting their outlets to pawn shops, check cashers, auto title and whatever else they can come up with," said Austin DeBey, vice president of governmental affairs for the Arizona Credit Union League.
The league, joined by the North Carolina-based Center for Responsible Lending, AARP, consumer groups and others, saw the payday proponents' final attempt go down to defeat Wednesday after a state Senate panel declined to revive a bill overturning a 2008 voter referendum rejecting payday firms.
The payday proponents, led by large national firms which control many of the state's 650 shops, maintained the high rate offerings should remain since the market has shown a need for short term, emergency loans not available from banks or CUs.
In trying to win lawmaker support, the payday proponents also offered to set up foundations to provide grants to consumer groups and special counseling services for debtors.
"Defeat of the bill is a victory for consumers," said DeBey of the league. Arizona now joins a handful of states which have barred or severely restricted payday operations with North Carolina and Ohio singled out as two of the leaders.