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KERA's One Crisis Away project focuses on North Texans living on the financial edge.

New Alternative In Dallas To Payday Loans


When faced with a financial emergency, some turn to payday or car title lenders. There’s about 175 of them in Dallas offering quick cash at great cost. The city and an Austin-based lender to small businesses have announced an alternative.

As part of KERA's ongoing series One Crisis Away, Rosa Rios-Valdez, the CEO of Business and Community Lenders, or BCL of Texas, explains the problem with payday loans.

From Ms. Rios-Valdez’s interview…

What’s wrong with payday loans: The interest rates can be in excess of 400 percent and the payments are due in ten days. So often the families aren’t able to make those payments in ten days, and then the outcome is that it revolves another time and fees are assessed some more, and that excessive interest rate continues.

BCL’s alternative: If an employer is enrolled in BCL of Texas and the Community Loan Center program, then any of their employees can apply online for our service. They can borrow up to a thousand dollars. Our interest rate is disclosed; we have a cap at 18 percent. The only fee we charge is 20 dollars, one time only. It is an unsecured loan, no credit checks. What we’re verifying is their employment. We provide them with consumer counseling, credit counseling, if they want it.

What more could/should be done: We’re collaborating with the Community Loan Centers of Texas and we will have similar programs across the state. But we really need a policy issue where the Legislature puts families and their needs for borrowing fairly as a priority. And that hasn’t happened.

For more information

BCL of Texas: Community Loan Center 

Payday lenders group: Community Financial Services Association of America 

Sam Baker is KERA's senior editor and local host for Morning Edition. The native of Beaumont, Texas, also edits and produces radio commentaries and Vital Signs, a series that's part of the station's Breakthroughs initiative. He also was the longtime host of KERA 13’s Emmy Award-winning public affairs program On the Record. He also won an Emmy in 2008 for KERA’s Sharing the Power: A Voter’s Voice Special, and has earned honors from the Associated Press and the Public Radio News Directors Inc.