WASHINGTON — The payday-loan industry, threatened by Congress with extinction, has deployed well-connected lobbyists and hefty sums of campaign cash to key lawmakers to save itself.
The strategy has paid off.
Now a top Democrat who once tried to ban the practice is instead pushing to regulate it — a result, he says, of the industry’s lobbying clout.
The lawmaker, Rep. Luis Gutierrez, D-Ill., says his bill does have crucial protections for borrowers and represents the best deal he can manage in the face of the industry’s aggressive lobbying.
Consumer groups are condemning the bill as a loophole-riddled gift to the industry.
Payday loans are small, very-short-term loans with extremely high interest rates that are effectively advances on a borrower’s next paycheck.
