Wednesday, November 05, 2008

Passage of Issue 5 already costs Ohio jobs

The sad part is that some people think this is a good thing. And just how much payroll and property taxes were these stores producing for the government coffers???

Press Release:


Fort Worth, Texas (November 5, 2008) – Votes to repeal a portion of Ohio’s new short-term loan statute fell short of the amount necessary to leave the existing cash advance product in place for Ohio consumers. As a result of this vote, Cash America International, Inc. (NYSE: CSH) will proceed with its previously announced plans and intends to close approximately one-third of its Ohio lending locations over the next few months. The locations slated for closure are in various markets throughout the state and operate under the trade name, Cashland. (emphasis added)

“We respect the democratic process and thank the voters who came out to the polls to support the cash advance product,” said Daniel R. Feehan, president and chief executive officer of Cash America International, Inc. “Sadly, this outcome will force us to close about 43 of our Cashland lending locations, leaving about 150 of our hard-working coworkers without jobs.”

The Cashland locations that remain open will begin offering customers alternative services including short-term unsecured loans governed by a different statute and, in most shops, both gold-buying and/or pawn lending services.

“This was a hard fought loss for the industry, but more importantly it will hurt consumers who have nowhere else to turn for short-term credit and they will incur higher costs associated with bank overdraft fees, late fees and penalties on items such as utility bills and credit cards,” said Feehan. “As an industry, we did everything we could through efforts like the ‘Vote NO on Issue 5’ campaign to avoid loss of jobs and credit options, as well as to prevent negative economic impacts in the State through the loss of jobs and the closing of many places of business.”

Calling for the repeal of a portion of Ohio HB 545 was necessary, said Feehan. The bill calls for an annual rate cap of 28 percent, which isn’t economically feasible for store front providers of small short-term loans to customers. The new law reduces the fee charged on a $100 two week loan to $1.08 (less than 10 cents a day). “There is no way to sustain a viable store front business by offering small, short-term unsecured consumer credit at this rate,” said Feehan.

“As a Company committed to helping people, we will do our best to continue doing business in Ohio by offering other products and services. We assured our coworkers in Ohio that we would do everything we could to save their jobs,” said Feehan.


Roman said...

Another try for some well meaning people wanting to tell other people how to live. It is so easy to be a liberal, all you have to do is want good things to happen. Your actions have unintended consequences, and if they are not forseen, you cannot be faulted, because you had pure intentions.

Maggie Thurber said...

Very profound, Roman. Thanks!

navyvet said...

One more freedom of choice...LOST!

The A-Hole Lawyer said...

I reasearched pay day lending/lenders in MI earlier this year. I don't think Monroe has one yet -- and I believe MI still allows pay-day lending.

Potential business boom in Bedford, Temperence, and Monroe??!!


Antipelagian said...

What I found interesting was not that the State wanted to curb usury...but that they wanted a database with everyone's info and force people to take classes.

I'm okay with outlawying usury but this is an excuse for the State to stick it's nose where it doesn't belong.

roman said...

I agree with roman, and coming from another roman that really means something. Nice post Maggie - I'll be stopping by from time to time.

Hooda Thunkit said...


I agree with all of the above, especially Antipelagian.

Usury, no.

Government sticking itself in personal business and playing nanny, also NO!

The A-Hole Lawyer said...

As I drove Mrs. AHL to several consignment stores yesterday (she works with art frames, matting etc. as a hobby) I saw several payday lenders closed, windows papered over, and for lease signs in their windows.

I have not driven by my lender of choice, Check Into Cash, but they had professed to remain open if issue 5 passed. I will be surprised if they can remain afloat on some of their other services - check cashing, pre-paid credit cards and tax preparation, given that the new law reduces their $15 fee on $100 loan to $1.08.

At least with gas under $2 (a temporary phenomena now that Obama has been elected - but that's another string) we can run up into SE MI and get a loan if necessary. Maybe even smoke a cigar and see some nudy dancing after midnight while we are there.


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