Payday Lenders Closing in Ohio

New regulations have certainly challenged the payday industry, especially for those located in Ohio, as reported by the Middletown Journal. The recent cap on annual percentage rates of 28 percent on these safe payday loans has numerous payday lenders closing up shop. In the past year, 640 payday lenders have closed across Ohio. Interestingly enough, the very banks that had once denied consumers small loans are now trying to entice some of the payday company customers with special overdraft loans, charging $10 per $100 credit extension, so that those with direct deposit can avoid overdraft fees of $60 on the potential $1.00 you might have gone over the account balance. While this has been marketed as a safe way to help consumers, it surely does not encourage responsible spending practices. Thanks, but no thanks! Of course, an unintended consequence of the regulation is that those who could benefit from a source of small and quick loans could be adversely affected by a loss of assistance during these hard times. A few bad apples in the payday lending industry unfortunately seem to have hurt other cash advance loan companies within Ohio that use responsible lending practices and try to work with consumers to use the loans in a beneficial way. Perhaps, if anything, the current credit crunch across America may have taught more consumers to refocus their priorities on a tactical financial strategy designed around saving for the unexpected, such as job loss or health crisis.