Our team reviews annual reports provided by licensed payday lenders in Minnesota to the state’s Department of Commerce every year. And every year, unsurprisingly, the data reveals a pattern of persistent indebtedness amongst borrowers. In 2021, for example, about 20,000 Minnesotan payday loan borrowers averaged nine loans each. Repeated borrowing is the norm, not the exception, and it’s an outcome that exclusively benefits the lender at the expense of the individual. As the Consumer Financial Protection Bureau (CFPB) ’s director, Rohit Chopra, wrote, “payday lenders have a powerful incentive to protect their revenue by steering borrowers into costly re-borrowing.”
On average, we refinance debt with 306% annual interest! Thus, we estimate our efforts have saved 535 Minnesotans more than $1.3 million that they would have otherwise paid to predatory lenders over a year’s entrapment. And while our refinancing program has a significant and immediate impact on borrowers’ lives, we will also begin offering small-dollar personal loans this year to more comprehensively meet Minnesotans’ financial needs. We will also continue to center our borrower’s and community’s voices as we define and design equity-based lending.
“I was worthy again, like someone gave me a chance. I just didn’t feel like this less-than-human individual being… It was a big relief, and it felt like I was of value again.”
– Amanda, Exodus Lending program participant
Our Fundraiser is Next Month!
Don’t forget that our “Lending & Transcending” fundraiser is less than one month away! We are excited to celebrate joy and healing through art and entertainment on Tuesday, July 26th. Enjoy a program about Exodus Lending’s growth followed by a performance by Lady Midnight. Early bird tickets are $25 each through July 12th and include two beverages and a meal from O’s Kitchen.
Along with generous contributions from individuals, Exodus Lending has also received grants from Christ the King Foundation, The Otto Bremer Trust, The Patch Foundation, and St. Anthony Park Community Foundation. Thank you for supporting our efforts to eliminate predatory debt and create safe alternatives for Minnesotans.
Predatory Lending in the News
In case you missed it, here are some of the latest news items on predatory lending:
Exodus Lending E-Newsletter: June 2022