In response to House Financial Services Committee Chairwoman Maxine Waters’ letter to Treasury Secretary Steven Mnuchin and Small Business Administrator Jovita Carranza calling to exclude lending businesses and their employees from participating in the Paycheck Protection Program (PPP), Online Lenders Alliance CEO Mary Jackson issued the following statement:
“At a time when consumers are facing income disruptions and additional unexpected expenses, options that allow nonprime and underbanked consumers to access credit are more important than ever. Chairwoman Waters’ letter fails to recognize that consumer credit providers as essential services, which has been acknowledged by both federal and state authorities, as well as the operational costs associated with running a lending business.
Our doors, online portals, and call centers are open to serve consumers for their credit needs while at the same time maintaining payroll for our employees. Like many other businesses, lenders’ operations are suffering and as the CARES Act became law, it stated that all businesses were eligible. Employees of legal, licensed, and regulated lending companies are just as deserving of payroll protections as those of any other legitimate industry in the country.
Let’s be clear. The PPP was designed to help hardworking employees stay in their small business jobs and keep them receiving wages. It was not designed to impose or enable overnight moral judgments about entire industries. Lawmakers can and do engage in reasonable debate about the regulation of small-dollar lending in the halls of Congress. That is completely fair. Resolving that debate administratively, and on the backs of hardworking Americans who prefer the dignity of work over being laid off, is not.
The current borrowing trends for our consumers have dropped 60-80% which demonstrate that our borrowers are smart about conserving their income and not taking on further debt during these uncertain economic times. However, for those who are still employed, ensuring credit options for borrowers and supporting credit providers remains imperative.
We ask Chairwoman Waters to not use the CARES Act and the Paycheck Protection Program to harshly discriminate against Americans who have the same need to support their families as others do. We urge the Department of Treasury and Small Business Administration to protect consumers who need credit options and Americans who work in legitimate industries by unequivocally rejecting this request.”
The Online Lenders Alliance (OLA) is the first trade association in FinTech. OLA is focused on credit inclusion, bringing together a diverse group of innovative companies who share a common goal: to serve hardworking Americans who deserve access to trustworthy credit. Our members are entrepreneurs, publicly traded companies, lenders, credit bureaus, advertisers, lead generators, compliance professionals, and software developers who are leveraging technology to responsibly improve consumers’ financial health. Consumer protection is our top priority and OLA members abide by a rigorous set of Best Practices and Code of Conduct to ensure consumers are fully informed and fairly treated. For more information and to review our most recent policy white paper highlighting how innovation in the financial technology space is playing a role in driving credit inclusion for the approximately 100 million Americans who currently fall into the non-prime credit category, please visitwww.onlinelendersalliance.org.