Who knew? Elizabeth Warren might not be the blinkered consumerist ideologue we took her to be:
Q: How do you regulate services like payday loans and still ensure people have access to small loans?
Well you know, access to small-dollar loans is critical to many families. The notion that we (will) somehow try to eliminate that, it’s just not going to happen.
It can force people into unregulated markets, including “Jimmy the Leg Breaker,” which is not where we want people to be.
So it is important from a regulatory standpoint that people are not at the mercy of lenders who build business models around fooling people. They’re drawn in the front door thinking they’re going to pay one price and then beat about the head and ears, financially speaking, so that they’re paying much, much more.
On the other hand, there’s a real problem. And that is how to get good small-dollar lending started in areas where there’s great need. . . . [Emph. Added]
Go Liz! Too many “pro-consumer” advocates dismiss out of hand the idea that payday lenders provide any real benefits whatsoever. Credit to Warren for understanding that they fill a real need. Am not optimistic as to her plans for how the business should operate, but at least she won’t be proposing the industry be put out of business altogether. . . . P.S. Nice reference to “Jimmy the Leg Breaker.” . . .