The undersigned consumer, labor, civil rights, legal services and community organizations write in strong
support of the Consumer Financial Protection Bureau’s proposed interpretive rule on emerging paycheck
advance products, sometimes marketed as “earned wage” products.
Workers should not have to pay to be paid, and we support the CFPB’s efforts to guard against predatory lending in the workplace and to prevent evasion of consumer protection laws by new forms of payday loans.
Lenders should not be allowed to disguise 300% APR loans in so-called “tips,” expedite fees or other junk
fees, or by claiming that their loans are not loans. Advances of wages or other income, repaid later, are loans regardless how they are styled. All payday advances need clear cost and fee disclosures. Workers of color and lower-income workers are particularly susceptible to predatory lending practices as they may have less access to traditional banking services and products and are also less likely to be paid a living wage.