Banks & Credit Unions Help Send People to Payday Lenders
Over half those who overdraft go to payday lenders.
Why? Banks and credit unions restrict credit.
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Overdrafts Driven by Limits
Lake Forest, IL (November 5, 2019) Since 1998 the median overdraft limit has not changed and is still at $500, while the OD price has increased from $18 to $30. “Something has to change very quickly,” exclaims Michael Moebs, “or depositories will face huge declines from their main source of fee income – overdrafts, and a loss of consumer users to Payday Lenders.” The proof is overdraft revenue has been flat for 10 years in a range of $30 to $34 Billion.
“When I can walk into a payday lender,” states Moebs, economist and CEO of Moebs $ervices an economic research firm that did the Limit Study, “and get $100 for an $18 charge, the same price as banks and credit unions charged 21 years ago, but are now charging $30, and the limit at depositories is the same as 21 years ago, there is something very wrong in the financial institution (FI) overdraft business!” READ FULL ARTICLE
Written By: m.moebs
Date Posted: 11/6/2019
Number of Views: 289