Comedian John Oliver left his post with Comedy Central’s The Daily Show and is now making waves of his own with his weekly HBO news commentary Last Week Tonight. Last week on Last Week (I think that’s right), Oliver dedicated more than 15 minutes to the problems with payday loans.
Here are my four favorite quotes from Oliver's payday loan takedown.
CNBC Newscaster: “Some of those rates, legally, are as high as 1,900% a year.”
Oliver: “Nineteen hundred percent! Even the most demanding, abusive football coaches only ask for 110.”
“Three quarters of the industry’s volume was generated by borrowers who have to reborrow before their next pay period. Basically, payday loans are the Lays potato chips of finance, you can’t have just one and they’re terrible for you.”
Billy Webster, co-founder of payday lender Advance America: “The consumer demand for this product is overwhelming. It speaks for itself.”
Oliver: “Okay, that’s fair. Although, it’s worth pointing out that the customer demand for heroin is also overwhelming and that doesn’t necessarily mean it’s a product you’d recommend to your friends to get them out of a jam.”
Comedian Sarah Silverman: “Hi, I’m Sarah Silverman. If you’re considering taking out a payday loan, I’d like to tell you about a great alternative. It’s called anything else. The way it works is instead of taking out a payday loan, you literally do anything else.”
Finally, Oliver touched on a fact that has consumer advocates scrambling to find a better solution for those would-be borrowers that are most in need of relief: "A Pew survey found that a majority of borrowers said payday loans take advantage of them, but a majority also said they provide relief."
Yes, people sometimes need a short-term lifeline. So what can you do to ensure your members have better options? From financial education that will help members avoid a payday trap altogether to your own alternative loan products, the answer is out there.