Domenick says alternatives needed to payday lending

COLUMBUS — State Rep. John Domenick, D-Smithfield, voted against a measure Thursday that would place restrictions on the operation of payday lenders in Ohio.

Domenick said he is not a fan of payday lending but could not vote to support restrictions that could put companies out of business.

“The reality is, payday loans are an unfortunate necessity for many Ohioans,” Domenick said. “Many people cannot make ends meet living from paycheck to paycheck. Job losses and the failed economic policies of the Bush administration have put an increasing number of people in this situation.”

Domenick noted more than 1,600 payday lending offices operate in Ohio with about 6,000 employees. He said owners testified that a 28 percent interest cap in the bill that passed the Ohio House would drive them out of business.

“I don’t think this is the time to be putting more Ohioans out of work,” Domenick said.

He said there is a lack of viable options available to consumers who use payday lenders.

“They are not the best answer to short-term financial needs, but they are an answer,” Domenick said. “After receiving numerous calls and letters, I am concerned that the void would be filled by loan sharks, online lenders and other unregulated sources of short-term money.”

Domenick said he would work with banks, credit unions and other organizations to encourage them to offer reasonable short-term loans.

The payday lending measure is pending in the Ohio Senate.



(Giannamore can be contacted at pgiannamore@heraldstaronline.com.)