U.S. Bancorp among big banks criticized for payday lending

Author:
Updated:
Original:

A new report from the Center for Responsible Lending finds some of the nation's largest banks, including Minnesota-based U.S. Bank and California-based Wells Fargo, continue to offer costly advance-deposit loans that can trap borrowers with triple-digit interest rates, the Washington Post reports.

The study found the payday advances -- pitched as short-term borrowing -- typically cost about $10 for every $100 borrowed. However, overdraft fees and additional interest can quickly add up if there is insufficient funds when a payment is due.

“We’re very clear that this is an expensive form of credit and not to be used as a long-term solution,” Wells Fargo spokeswoman Richele Messick told the newspaper. “We are very upfront and transparent with our customers about this service.”

Click here, to read the Center for Responsible Lending's full report.

More Minnesotans are turning to the high-interest loans. Demand has more than doubled from 170,000 in 2007 to 350,000 loans in 2011 — the highest ever reported to the Minnesota Department of Commerce.

Next Up

Minneapolis police

Mayor Frey, Minneapolis police chief reveal new 'no-knock' policy

The new policy for Minneapolis Police Department was announced Wednesday.

Teddy Bridgewater

Coller: It's a what-if Sunday with Teddy Bridgewater's return

Matthew Coller writes a weekly Vikings column for BMTN, with more of his work found at Purple Insider.

Ambulance hospital emergency

15-month-old girl's death being investigated by police in Fargo

The child died four days after being found unresponsive.

PD Shimmers closeup

Man with Parkinson's lights up Plymouth with synchronized light show

"The best medicine I have for my disease is what I try to do with the light show," Mike Justak said.

Screen Shot 2020-11-25 at 7.34.43 AM

Watch: Drunk squirrel in Minnesota captures the world's attention

The squirrel was immediately cut off after nearly tipping over.

Screen Shot 2020-11-25 at 7.15.09 PM

Small town gym refusing to close facing lawsuit from attorney general

The gym is facing a lawsuit and a temporary restraining order to halt their operations.

credit card, payment

Money Gal Coaching: Bouncing back after living your best life

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.

flickr-mall-of-america-mitchell-hirsch-march-2019

When do stores open on Black Friday this year?

Many major retailers will be open Black Friday, some for extended hours.

Related