Letters to the Editor

HB 1290 encourages responsible borrowing, ensures credit for those who need it most

Dear Editor,

A recent article about short-term lending and related legislative activity seems to get stuck in the weeds [“Payday loan bill started off like a racehorse…” Statesman, 4/22], and fails to provide clarity around the efforts of the state Senate to regulate new consumer loans.

Lawmakers are seeking to work out the details on allowable rates for consumer lending in the state, ensuring that the treatment of origination fees on six-month consumer loans are consistent with the majority of other loans that involve similar fees. The bill that lawmakers are currently considering — HB11-1290 — would retain the valuable consumer protections passed last year by the Legislature; it would also align the law with the original intent of lawmakers who crafted those reforms.

But here is what is really important to consumers and business leaders alike about HB11-1290, which passed the House last month: it provides a competitive and consistent regulatory environment for lenders to offer short-term credit. It preserves a viable lending model as well as the hundreds of jobs and thousands of tax dollars for Colorado.

Several of the state’s most prominent business groups including The Denver Metro Chamber of Commerce, the Colorado Hispanic Chamber of Commerce of Metro Denver, the Colorado Association of Commerce and Industry, Colorado Competitive Council and the National Federation of Independent Business (Colorado chapter), have all cast their support for the bill, which they see as vital to keeping open options for consumer finance in the state.

Without reliable access to regulated short-term credit, consumers are often forced to turn to more expensive, less regulated services such as offshore Internet loans. Because these loans are offered outside of the jurisdiction of state regulators, they typically have higher fees than other forms of short-term credit and offer none of the consumer protections that in-state lenders provide.

The members of the Community Financial Services Association and the Colorado Financial Service Centers Association support HB11-1290 because it enables a lending model that encourages responsible borrowing and ensures the availability of credit for those who need it most.

Jamie Fulmer
Vice President-Public Affairs, Advance America, Cash Advance Centers, Inc.
Spartanburg, S.C.