At long last, shark week has come--that time of year when bloodthirsty predators get a moment in the media spotlight. Only it's not the shark week you're thinking of.
In time with the Discovery Channel's week of programming that portrays intelligent and social animals as the vicious butchers of the sea, the National People's Action (NPA), a grassroots coalition, is launching a campaign to highlight the payday loans that devour millions of Americans in a "devastating cycle of debt" every year.
From July 6-10, under the banners #SharkWeek and #StopTheDebtTrap, NPA will publish stories of "loan shark attack survivors"; circulate a petition calling for an end to the most deceptive and abusive lending practices; and hold on-the-ground events in 11 states, among other actions.
"The most dangerous sharks in America aren't found in the sea," NPA said on Monday. "They're the payday loan sharks lurking on neighborhood corners and on the Internet and they offer small dollar loans that take a big bite out of family budgets with interest rates averaging roughly 300 percent."
In addition to those kinds of dizzying interest rates, payday loans also use "deceptive terms, automatic 'rollovers', [and] staggering fees" to drain borrowers of more than $10 million annually.
"These sharks target their attacks. Storefront payday lenders are much more likely to target People of Color and low-income workers who can least afford these loans," NPA writes.
"The most dangerous sharks in America aren't found in the sea. They're the payday loan sharks lurking on neighborhood corners and on the Internet and they offer small dollar loans that take a big bite out of family budgets with interest rates averaging roughly 300 percent."
--National People's Action
Previous studies have found that payday lenders are much more likely to set up shop in predominantly black and Latino communities than white communities.
In its first feature of the week, NPA shares the experience of a woman named Candice, who was forced to use a payday loan at age 23 to make ends meet after her work cut her hours. But soon after taking out one loan, Candice found herself trapped in a cycle of debt, as the sky-high interest rates on one loan forced her to take out another just to pay it back on time.
In one year, Candice was near bankruptcy, had lost her car and apartment, and had missed out on job opportunities.
But Candice is just one in 12 million Americans who fall victim to similar predatory lending schemes every year, according to NPA.
"Loan shark attacks are a financial disaster for millions of hard working families," the NPA states. "Payday borrowers are twice as likely to file for bankruptcy as households with similar incomes who were denied a loan and 92% more likely to become delinquent on their credit cards or lose their bank accounts."
While the NPA campaign is timed to coincide with the annual television event, it also comes in anticipation of the Consumer Financial Protection Bureau (CFPB) releasing a new rule on small dollar payday loans, which is expected to come out this fall.
To that end, NPA is calling on the CFPB to issue "a strong, broad and effective rule...that will put a stop to the worst of these abuses."
