Norfolk Places Restrictions on Payday Loans
By J.J. CameronPayday Loan Writer
That didn't take long.
Soon after we reported that Norfolk, VA was looking to regulate its payday loan industry, the City Council voted 7-0 to restrict the growth of those lenders and check cashing businesses earlier this week. Tuesday night
Any new thrift stores, payday advance lending and check cashing establishments are banned from most of the city’s small shopping centers as a result of this vote. More importantly, any new stores – which would be allowed only in medium to large shopping centers – must receive permission from the City Council in order to open. The Virginian-Pilot had the report.
The restrictions came largely at the urging of City Councilman W. Randy Wright, who was concerned about the growth of thrift stores and the influx cash loan operations of along East Little Creek Road.
Most council members deemed faxless payday loans to be “predatory.” Only one citizen – Neil Walsh, who said he represents the Association for the Advancement of Retired Persons of Virginia – spoke at Tuesday’s meeting about the issue. He endorsed the ordinance, noting that some payday loan lenders charge 390 percent interest for a two-week cash advance, and that these loans are aimed at “the working poor and military families."
The issue of payday loans has been at stake for awhile in Virginia. The new special exception process for such stores/lenders has been used by the city for years on restaurants and stores seeking to serve alcohol.
“It’s worked very well,” Councilman Barclay C. Winn said. “We’re not trying to unduly limit these type businesses, but we should have the final say in where we go.”
Wright said two thrift stores recently opened on Little Creek Road in apparent reaction to the impending ordinance. He has been on a campaign for more than a decade to try to bring what he calls “quality” retail establishments to Little Creek Road - instant payday loan businesses really don't qualify as such.
Wright said the ordinance passed Tuesday “is not going to be a short-term fix. It’s going to take years to fix. But at least we can begin to get our arms around it.”
The hope is that those seeking payday loans will, eventually, have to go elsewhere in order to apply for them.
