Google's decision to ban payday loan ads is unlikely to hurtcredit unions offering alternatives to the controversial loans,experts said.

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In fact, the ban could help credit unions and the people whoneed short-term loans, they noted.

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“I would agree that it could have the indirect impact ofelevating our products in the minds of our members and potentialmembers by removing the distracting junk of the predatory stuffthat gets advertised on the internet,” Hank Hubbard, president/CEOof the $33 million One Detroit Credit Union in Detroit, said.

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“You can stop the advertising, but you can't stop the need,”said Ben Morales, CEO for QCash, which markets a payday alternativeloan program to credit unions.

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On May 11, Google announced starting July 13, it will ban adsfor loans for which repayment is due within 60 days of the issuedate. In the U.S, the company will also ban ads for loans with anAPR of 36% or higher.

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“When reviewing our policies, research has shown that theseloans can result in unaffordable payment and high default rates forusers so we will be updating our policies globally to reflectthat,” Google Director for Global Product Policy David Graff said when the ban was announced.

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The ban was announced weeks before the CFPB was expected toissue rules governing payday lending.

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The Google ban won't significantly or directly impact Hubbard'scredit union, he said.

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“We didn't advertise on Google, so if they determined that ourproducts fit their ban, it wouldn't matter,” he said.

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Morales said credit unions using QCash won't be affectedeither.

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However, an executive at a large, non-credit union payday lendersaid the Google ban could be devastating to his industry.

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“It impacts how we market ourselves and we're going to have tochange that strategy,” said Jamie Fulmer, a senior vice presidentat Advance America, one of the nation's largest payday lenders andthe subject of a great deal of criticism by consumer advocates. “Ithink it's significant.”

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The advertising ban does not mean that the need for short-termloans will disappear, Morales said.

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“You can block access, but it's not going to block demand,” hesaid. “The consumers are going to be looking.”

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And Morales said he hopes those consumers will look to theircredit union for help. Morales' company and Hubbard's credit unionmarket their loans as payday loan alternatives.

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One Detroit offers a program called MyPay Today, which allowsmembers to borrow $500 at 18% APR and repay the loan in 60days.

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QCash offers credit unions a program that enables their membersto apply for a loan, receive a response and see the funds depositedin their account in about one minute. The loans do not require acredit check; instead, approval is based on the member's experienceat the credit union and behavioral metrics.

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