2009: Better than Feared
By PHILLIP LEE
As 2009 comes to an end, the payday loan industry has come through little worse for wear on the legislative front.
According to D. Lynn DeVault, board chair of the Community Financial Services Association of America, there has been plenty of activity, but in the end, things have been relatively positive.
CFSA is tracking about 178 bills in the states. It opposes 101 of those. “I think we’ve had some fairly good fortune in the states legislatively this year,” DeVault says. “We have a number of bills out there that are still active, but generally speaking things are okay.”
There was the expectation of a big legislative push on the state level after the defeat of referendums in Arizona and Ohio, but nothing materialized.
DeVault believes that action at the grassroots level was the key to the lack of movement in payday loan legislation. Legislators were being informed and educated about the payday product.
DeVault says this effort began over the last 18 months when a more general public campaign wasn’t working. CFSA concluded that this is a product that needs to be explained one on one.
Four Troubling States
While it has been calm, DeVault and CFSA knows that problems can arise at any time, in any state. In particular, they will be keeping a watchful eye on four states.
“We have the sunset (provision) in Arizona. We’re watching Colorado. They have a 36 percent bill filed in Wisconsin, that’ll carry over to next year, and we’re always worried and anxious in Ohio,” DeVault says.
She notes that CFSA has about 40 company-paid lobbyists and 75 contract lobbyists working in 34 states.
But success also has been achieved on the federal level. Sen. Richard Durbin’s 36 percent bill was stopped, as was any amendment to the Consumer Financial Protection Agency Act that would have set a federal usury cap.
CFSA continues to increase its staff and lobbying efforts, but those efforts cost money, and the association would like to see more support from everyone in the industry, particularly check cashers and online lenders.
“I certainly don’t want to be critical of any other groups, but we’re the people paying all the lobbyists and they’re taking all the credit with their members,” says DeVault, while stressing that there is good coordination among the groups. “We’re still challenged as to how we are going to allocate our resources. We really need members.”
DeVault believes that there is no reason why members of other associations can’t join CFSA and vice-versa.
In reflecting on 2009, DeVault believes that the industry, just like the general economy has begun to rebound after a slow start.
DeVault also had a different perspective on the recent election, believing it was not about political parties, but more about issues.