Ogden, Utah, has capped the number of short-term lenders allowed within city limits. Image from Flickr.
A ordinance passed by the city council of Ogden, Utah, on Tuesday puts a restriction on the number of payday lenders, title lenders and check-cashing companies allowed in the city. This new ordinance is not as stringent as the Ogden Planning Commission recommended. Current payday lenders in Ogden will not be affected.
Ogden, Utah, payday lending ordinance
The ordinance the council passed Tuesday limits the number of in-city, short-term-loan businesses to 15. This ordinance will affect payday lenders, title lenders, check-cashing companies and short-term loans companies. These businesses will also not be allowed to open “within 1,000 feet of a similar business or within 660 feet of a pawnbroker or sexually oriented business.” Finally, all businesses will be required to display a sign explaining that short term loans should not be used as a general financial strategy. Other provisions of the ordinance were removed before it was passed, including a limitation on the color schemes on the exterior of buildings.
Effect on current payday lending businesses
Currently, within Ogden, 21 businesses fall under the ordinance. The new ordinance will not require any of these businesses to close. Instead, no new short-term loan businesses will be able to open until the number drops below the 15-store threshold. Any new stores that open under while this ordinance is in effect will be required to fulfill the placement and signage requirements.
Arguments regarding payday lenders in Ogden
There was heated argument within the Ogden City Council before the new ordinance was passed. The Ogden Planning Commission had recommended the number of lenders be capped at eight. Some members of the Ogden City Council believe that these businesses “disconnect residents from traditional banks,” which they believe harms economic development. On the other hand, payday lending customers and council members point out that the service payday lenders provide can be very useful for residents living paycheck-to-paycheck, and that not being tied to a traditional bank can sometimes be a positive thing.
REALLY!?
HUMANS are able to make their own decisions limiting the number of payday companies in any area will hurt the state in economic development not cure it. What about the employees that work for the payday loan company and everything that comes with it? We need payday companies and we shouldn't punish the people who know how to use a payday loan correctly just because the other people who abuse it and get themselves more into debt. I work for a payday loan so although my opinion may seem bias when I say I think that it's crap what they are trying to do, I have also been on the other side as a consumer where using a loan and it has saved me so much money. I don't have good credit due to medical bills, college, and basically life. We aren't all built in a nice home with a dog and car so to the less fortunate people who do have a job and work hard to keep a life and food on the table, when we run into trouble and our savings isn't enough we need some help. I took out a loan from Check City because after paying my medical bills for my daughter, regular living bills (car, insurance, electricity, gas, water, sewer and etc) I didn't have enough to pay my rent because of medical bill I took out a loan and it only cost me 25.00 till my next payday to have it and pay it off. I was approved I got the loan paid my rent instead of getting charged 65.00 for a late fee from my land lord I saved money and I paid if off as soon as I got paid. THE RIGHT WAY to use it. UTAH as a state cannot be 'mom' to everyone.