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COVID-19 financial warning: Consumers and banks should stay away from payday loans

NNPA NEWSWIRE — Zeroing in on the economic impacts of the crisis, people everywhere are struggling with competing needs in their lives. When living costs exceed available financial resources, tough times lead to tough decisions about how to feed families, keep a home to live in, ways to keep utilities working and a myriad of other day-to-day needs.

Published

7 years ago

April 10, 2020

Oakland Post

Charlene Crowell is a senior fellow with the Center for Responsible Lending. She can be reached at charlene.crowell@responsiblelending.org. (Photo: iStockphoto / NNPA)

By Charlene Crowell, NNPA Newswire Contributor

For the foreseeable future, ‘normal’ life will be indefinitely suspended due to the global pandemic known as the coronavirus.

Record-breaking employment layoffs in the month of March resulted in the Department of Labor reporting that 10.4 million consumers lost their jobs and filed for unemployment compensation. As medical experts continue to track the virus, the New York Times reported at least 214,461 known infections and at least 4,800 related deaths.

Beyond these statistics, untold numbers of additional school and retail closures, and an expanding army of people working from home have also been directly affected by the virus.

Consumers both young and old have passed as the virus continues to spread across the country. Its viral wrath has spawned hot spots from the Pacific Northwest’s Seattle, to the Gulf Coast’s New Orleans, the Midwest’s Detroit and the nation’s largest urban metropolis, New York City.

Zeroing in on the economic impacts of the crisis, people everywhere are struggling with competing needs in their lives. When living costs exceed available financial resources, tough times lead to tough decisions about how to feed families, keep a home to live in, ways to keep utilities working and a myriad of other day-to-day needs.

Despite a $2 trillion federal rescue enacted with bipartisan support, checks of $1,200 promised to taxpayers, along with an additional $500 per child will arrive too late for first of the month April payments for bills like mortgages and rental payments. Many leaders also warn that despite its size or range of areas addressed, the legislation was not enough.

In a March 27 House floor statement, Congresswoman Maxine Waters, Chairwoman of the House Financial Services Committee warned colleagues that their job was not yet complete.

“[I] must make clear that the legislation is far from comprehensive, and that there are issues it leaves unaddressed and areas where it falls short…The American people need help now and this bill represents a down payment on that relief,” said Waters.

A similar reaction came from AARP chief executive Jo Ann Jenkins.

“Older Americans face the one-two punch of coronavirus’s health and economic consequences, and many need immediate relief and ongoing help and support to cope with the pandemic,” noted Jenkins. “Those needs are only set to grow in the weeks and months ahead.”

What can really make a difference between life’s success and failure is not just what leaders do but also what they didn’t do when they had the chance. The recent legislative package was silent on interest rates, as well as forgiveness of federal student loans, negative credit reports or bans on private evictions for late rental payments.

As the cost of living has risen faster and higher than most consumer incomes for more than a decade, the likelihood of a savings account large enough to cover household expenses for a month or more is slim to none.

The Consumer Financial Protection Bureau (CFPB), the agency tasked with protecting consumers from unscrupulous lenders has been conspicuously subdued. Instead of forceful and timely agency alerts via multi-media communications warning consumers about opportunistic scam artists, CFPB has offered a modest tip sheet on how consumers – not government – can protect themselves. Fortunately, as the viral saga unfolds, some news outlets are reporting on the potential harms of consumers turning to payday and car-title loans.

A joint response by five federal regulars – Board of Governors of the Federal Reserve System, Consumer Financial Protection Bureau (CFPB), Federal Deposit Insurance Corporation (FDIC), National Credit Union Administration (NCUA), and the Office of the Comptroller of the Currency (OCC) – came on March 26 in a statement that encouraged banks, savings and loans, and credit unions to offer “responsible small dollar loans” to consumers and small businesses during the pandemic.

According to the regulators, “responsible small-dollar loans can play an important role in meeting customers’ credit needs because of temporary cash-flow imbalances, unexpected expenses, or income disruptions during periods of economic stress or disaster recoveries.”

Without any specifics defining “reasonable small dollar loans”, the regulators’ statement could be an inducement to join triple-digit lenders’ financial exploitation.

For Black America and other communities of color, predatory short-term loans of $500 or less began decades ago when payday and car-title storefronts took prominent residence in our neighborhoods across the country. Loans that were marketed as quick fixes for millions of consumers morphed into long-term financial nightmares that deepened debt with every renewal. In many cases, the interest paid on these loans was often double or triple the amount of principal borrowed.

A coalition of civil and consumer rights organizations released a joint statement warning of the possible spike in high-cost lending by the nation’s depository institutions – banks, credit unions and savings and loans.

“This is the worst possible time for banks to make predatory payday loans,” said Americans for Financial Reform Education Fund, the Center for Responsible Lending, Leadership Conference for Civil and Human Rights, NAACP, National Consumer Law Center.

“Around the time of the last recession, a handful of banks issued ‘deposit advances’ that put borrowers in an average of 19 loans a year at over 200% annual interest,” continued the leaders. “These bank payday loans disproportionately harmed the financially vulnerable and badly damaged banks’ reputations. Since 2013 when regulatory guidance warned against this form of credit, banks have mostly stayed away. We trust that they will continue to do so as they do not want to repeat mistakes of the past.”

Charlene Crowell is a senior fellow with the Center for Responsible Lending. She can be reached at charlene.crowell@responsiblelending.org.

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Smooth Ride! Car Suspension & Comfort Tested #shorts

Smooth suspension meets surprisingly spacious legroom. Experience true comfort on any road!

Published

3 weeks ago

October 4, 2026

Oakland Post

Car suspension test demonstrating a smooth ride, comfort features, and handling on various terrains.

Experience the difference smooth suspension makes on rough streets. Check out the surprisingly good second-row legroom – test it yourself for true comfort.

Watch the full video: https://youtu.be/l9Z571za5Gc

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61 years since Selma, Houston leaders say the bridge remains to be crossed

61 years after Selma, Houston leaders say the fight for equality continues. The issues that sparked the marches still impact Black Americans today.

Published

3 weeks ago

October 4, 2026

Oakland Post

Houston leaders discuss the ongoing struggle for civil rights 61 years after Selma, emphasizing the need for continued action.

It has been 61 years since the Selma marches. But political leaders in Houston say that the issues protesters were marching for still plague the lives of Black Americans.

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Here is what you need to know about finding unique white elephant gift ideas that everyone wants to steal

The best white elephant gift ideas are funny enough to get a reaction but useful enough that people actually want to steal them. Look for gifts with a surprise factor, broad appeal, an inside joke, and just enough personality to spark some friendly competition. The wrapping paper comes off, the room goes quiet for half […]

Published

3 weeks ago

October 4, 2026

Oakland Post

The best white elephant gift ideas are funny enough to get a reaction but useful enough that people actually want to steal them. Look for gifts with a surprise factor, broad appeal, an inside joke, and just enough personality to spark some friendly competition.

The wrapping paper comes off, the room goes quiet for half a second, and suddenly everyone wants the same gift. That is the sweet spot. A great white elephant pick should make people laugh, lean in, and start plotting their next steal before the turn is even over.

Should a White Elephant Gift Be Funny or Useful?

A white elephant gift can be funny or useful, but the strongest choices usually give people a reason to laugh and a reason to keep the item. A practical gift with an odd design, unexpected feature, or playful theme can get a reaction without becoming something the recipient immediately wants to give away.

The right balance depends on the group. Close friends and family members may enjoy a ridiculous gag gift because they already understand one another’s sense of humor.

A workplace exchange, neighborhood party, or mixed-age gathering usually calls for something with broader appeal. In those settings, humor works better when it is built into an item people could still use afterward.

It also helps to think about how quickly the gift will make sense once it is opened. A strangely shaped kitchen tool, oversized mug, quirky desk accessory, or unexpectedly fancy everyday item can create an immediate reaction. Guests understand the joke right away, while the item still has enough practical value to attract a steal.

Pure gag gifts can be harder to pull off. Something that exists only for the punchline may get a big laugh during the reveal and then sit untouched for the rest of the game. If the goal is to bring one of the gifts everyone keeps fighting over, usefulness gives the joke staying power.

Memorable Present Ideas: Creating Inside Joke Gifts

Inside joke gifts can make a white elephant exchange feel much more personal, especially when most of the group shares the same stories. The trick is choosing a reference that people will recognize quickly instead of building the entire joke around something only two guests understand.

You can turn a memorable vacation mishap, office catchphrase, family story, or long-running group joke into the theme of the gift. A personalized comic book can work especially well when it turns familiar people or a ridiculous shared moment into part of the story.

Think carefully about who the joke involves before ordering anything permanent. The gift should make the person feel included in the fun, not singled out for the wrong reason.

Can You Bring Something You Already Own?

Holiday gift exchanges can be a good place to re-gift something you never used, especially if it is unopened and clean.

The following can all work if they still look presentable:

A duplicate kitchen gadget
An untouched game
A decorative item
A sealed gift set
An unopened candle
A new travel accessory

The goal is to give the item a second chance, not use the exchange as an excuse to clear out damaged or unwanted clutter.

Take a close look at the packaging before wrapping it. Faded boxes, missing pieces, visible wear, or anything that looks obviously used can make the gift feel careless.

Wrapping Budget-Friendly Gifts

Wrapping can make gifts more entertaining before anyone even knows what’s inside.

Misdirection works especially well for fun party games. Put a small gift inside a much larger box. Use packaging from an unrelated household item.

Add harmless weight so guests cannot guess what they are holding. The reveal becomes part of the joke without changing the gift itself.

You can also lean into the theme of the exchange. Bright paper, oversized bows, reusable bags, or deliberately over-the-top wrapping can make an ordinary item feel more memorable. If the gift itself is already funny, simple wrapping may work better so the surprise stays hidden until the last second.

Frequently Asked Questions

Is Picking Last an Advantage in White Elephant?

Picking last can be an advantage because you get to see almost every gift before making your move. Instead of choosing blindly from the remaining wrapped presents, you can steal something that has already caught your attention if the rules still allow it.

That advantage depends on the house rules. Some games limit how many times a gift can be stolen.

Others lock an item once it reaches a certain number of steals. If the most popular gifts are already unavailable, the final player may have fewer strong options than expected.

The first player can also get another turn at the end in some versions of the game. That rule can balance things out, since the person who started with the least information may get one final chance to steal.

How Do You Plan White Elephant for a Large Group?

For a large white elephant exchange, set a firm spending limit and establish the stealing rules in advance.

Create a clear turn order before the game begins. Drawing numbers as guests arrive can save time once everyone is ready to start.

Keep the number of steals per gift limited so the game does not drag on. It also helps to have one person track which creative holiday presents have been stolen and when they are locked, especially if dozens of people are participating.

Can You Play White Elephant Virtually?

A virtual white elephant exchange can work over a video call, with one person keeping track of the turn order and each steal. Guests can either mail physical gifts ahead of time or use digital gifts that can be delivered once the game ends.

Set the spending limit and stealing rules before everyone joins. It also helps to decide how gifts will be revealed and who is responsible for sending each one afterward so the exchange does not become confusing.