Top Denominational Leaders Met With Representative Ellison to Discuss Payday Lending Reform
Leaders from MN State Baptist Convention, AME Church, ELCA Lutheran Church, and the Pentecostal Assemblies of the World discussed the extraction of wealth from communities of color
Minneapolis – Led by ISAIAH’s President Rev. Paul Slack and the President of MN State Baptist Convention, Rev. Dr. Billy Russell, clergy from multiple denominations met with Congressman Keith Ellison today to discuss reforming the predatory practice of payday lending at the state and federal level. Clergy called out the practice of payday loans as usury and specifically targeting the poor and people of color – keeping parishioners in debt and stuck in poverty.
Currently there are proposals at the federal level from the Consumer Financial Protection Bureau to cap the number of loans people can take out, as well as several other changes. At the state level, clergy and religious leaders are advocating for state legislation to cap interest rates and protect consumers.
In addition, churches have responded to the crisis, finding ways to get borrowers out of the debt trap. Exodus Lending, an initiative of Holy Trinity Lutheran Church in Minneapolis has started a debt buy-back program to refinance payday loan debt at zero-percent interest. Interim Director, Meghan Olsen Biebighauser, acknowledged that while their program is vital, it cannot solve the totality of the crisis. Furthermore, the group recognized the role of the broader financial industry, noting that, “the big banks, like U.S. Bank are not meeting the needs of low-income Minnesotans.”
With the average borrower taking out at least ten payday loans in succession to stay afloat they find themselves in a fiscal catastrophe, “this is not simply a financial crisis but a moral crisis,.” Rev. Slack said.
Congressman Ellison pledged partnership in bringing the Consumer Financial Protection Bureau into the room to meet with community and faith leaders in November.
The group along with Ellison agreed that Payday debt is but the tip of the iceberg of medical, education, and credit card debt that is siphoning money out of our poorest communities. Rev. Grant Stevensen added, “the amount of money being extracted from our communities in the form of high-interest rates, fines, and fees is in the hundreds of millions of dollars. Reverend Russell ended the meeting declaring, “We are in this until we fix this.”