KANSAS CITY, Mo. -- Missouri payday lenders can charge between 300 and 1,900 percent interest on payday loans. On Tuesday, a Kansas City area nonprofit shared three specific changes they’d like to see put in place immediately to help end the cycle.
“CCO, Communities Creating Opportunity is calling on local elected officials to do all that is in their power to curb predatory lending,” Susan McCann of CCO said.
The group wants local officials to put a limit on the number of payday loan institutions in vulnerable neighborhoods, support alternative lending programs that offer fair interest rates (36 percent or lower) and do more to promote borrower education. Research shows the consequences of not taking action on the matter can be dire.
“As income inequality increases, we die earlier. In this country we don’t connect that often,” said Rex Archer, director of health for the KCMO Health Department.
In Kansas City, there’s about a 14-year difference between zip codes with the lowest life expectancy and those with the highest life expectancy. Financial insecurity is a contributing factor.
“Income inequality, individual poverty, area poverty are critical issues for health and safety of our citizens. When we start looking at these economic indicators, somewhere between one out of three and one out of two deaths a year in the city are due to these injustices,” Archer said.
In the past, CCO organizers say there are more payday loan storefronts in Missouri than the number of McDonald's restaurants and Starbucks coffee houses combined.