Letters and Corrections
Enforce Existing Laws on Payday Loans
Thank you for opening the discussion on the need for basic financial education and literacy, the importance of financial counseling and for the active enforcement of existing consumer protection law in the article “Payday Loans Drive Debts Deeper” (August 2015).
As you are now aware, our company was incorrectly identified as the source of the illegal loans alleged in the article. PayDayHawaii is a local company that has built a reputation for strict adherence to all consumer financial laws. We have served over 39,000 individual clients under Hawaii’s check-cashing law with only a single complaint to the state Department of Commerce and Consumer Affairs. That complaint to the DCCA was dismissed. We provide many financial services to Hawaii’s working families, from bill-paying services to tax planning and filing, from check cashing to USPS postal services, from Western Union money transfers to our Micro-Credit Advance short-term loans.
Our customers are just regular people who are unwilling or unable to utilize traditional banking services, or find it more convenient to take care of their financial needs in one place, with the same person. Many live paycheck to paycheck, and don’t have the luxury of a 401(k), an understanding employer or family members with money to loan.
We neither practice nor condone the illegal “payday loan” transactions described in your article. PayDayHawaii does not charge upfront fees or additional excessive fees if a client has insufficient funds to pay the transaction in full by the due date. Nor will we extend credit to anyone with an existing payday loan, or similar 32-day-or-less credit transaction, from any storefront check casher, online lender, bank or credit union. As well, PayDayHawaii will never allow multiple open transactions or transactions on behalf of another individual.
Hawaii law does not allow any client to roll over the transaction principle by paying the fee. And only one short-term credit transaction is allowed per consumer from any source at one time, in the opinion of the DCCA. The most a delinquent client would ever owe under the law is the original transaction amount plus a $20 insufficient funds charge. In the instance reported in this article, the maximum owed would be $480.
PayDayHawaii voluntarily provides a payment plan to any individual after four consecutive transactions to discourage repeat borrowing. We encourage the Hawaii Legislature to make this a mandatory part of the check-cashing law. Using short-term credit to solve a financial shortfall is not advised. Long-term amortized loans, plus financial counseling, best address such a need.
The anecdotal story recounted in your article illustrates the need for better enforcement of the existing law. It also reinforces the need for outreach to facilitate better financial literacy and understanding. On the PayDayHawaii website (paydayhawaii.com), we offer a section on responsible borrowing, as well as a monthly blog that addresses financial literacy issues. We also partner with AmericaSaves.org during America Saves Week each year. Nonprofit services, such as Hawaiian Community Assets, mentioned in your article, are invaluable and should be more widely publicized.
We encourage credit counselors and charitable and faith-based organizations to urge their clients who have been victims of illegal transactions under Hawaii’s check-cashing law to report violations to the DCCA at 587-3222. All residents of Hawaii are protected by this law regardless of whether they obtain a “payday loan” online or through a locally based check-cashing business.
R. Craig Schafer
President, Money Service Centers of Hawaii Inc. dba PayDayHawaii
No Right Way to Dive With Mantas
As a coastal ecologist I was surprised that your article on “Crowded Water” (July 2015) did not include at least a sidebar on the damage manta dives do to the ecology and quality of life of manta rays.
There is no right way to dive with mantas, no right way to train operators to exploit the behavior and habitat of the animals. Your magazine should publish an article looking at the ethical and environmental downside of the tours you lionize in your magazine.
Karen Elizabeth Chandler