Wall Street banks have found another way to economically exploit our communities by putting a new name on an old practice. Payday loans are now being offered by banks such as Wells Fargo, US Bank, Fifth Third Bank, Regions Bank and others under the deceptive name of “Direct Deposit Advances.” No better than the cash advance stores concentrated in underbanked neighborhoods, these supposedly reputable banks trap families and individuals in a cycle of debt — with fees and interest equivalent to an annual percentage rate (APR) in excess of 300% — saddling customers with debt that takes an average of nearly 6 months to escape.
Banks target these predatory loans at Black and Latino communities. These racially-discriminatory lending practices, like redlining, have been in use for generations to prevent minority communities from building economic stability, wealth and subsequent political power. The bank practices that created the housing crisis have decimated Black wealth, which is now at its lowest in 25 years.
We’re joining forces with our friends at CREDO Action to fight back against Wall Street banks pushing payday loans, by urging federal banking regulators to halt this exploitative practice. CREDO Action is a social change organization that fights for progressive values by engaging its over 3 million members in activism on a wide variety of issues, and together CREDO Action and ColorOfChange members can help put an end to payday lending by Wall Street banks.
Thanks and Peace,