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Virginia Town to Fund Payday Loan Education


21 April 2008
Alexandria City Council member, Justin Wilson, has proposed a new tax on payday lenders. This money would help fund consumer education services provided by the city.

The new tax would increase the rate payday lenders and car title lenders pay per $100 gross receipts. The rate would move from 35 cents per $100 to 58 cents. The additional $13,000 revenue generated from the city tax hike would go directly into consumer financial education.

A Payday Loan is typically a short term loan of a few hundred dollars, designed to cover cash short falls until the customer's next paycheck. The payday lender will hold a check till the customer's next payday and charge a fee to hold the check.

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