CFPB Wants to End Short-Term Loans That Can Help Real People

With just a little leg-up, Robert Sherrill got his second wind and bounced back.

Before he rose to fame, he had lived in public housing and had also spent some time in prison for handling federal drugs. Sherrill, who is a middle-school drop-out, has walked a fine line since he was released from prison in 2012. He eventually turned his life around by starting a commercial cleaning business making about $400,000 per year. His company currently has 20 employees.

Robert availed a series of microloans to meet business expenses at the beginning of his journey. Initially, he took $250 to foot the bill for his needs. He reimbursed it in a fortnight. Then, he availed another loan for business purposes. He handled payroll, purchased equipment and supplies and kept his head above water in the developmental stages of his business by the dint of these small loans.

No. Those tiny loans didn’t come from banks. There are two things that are beyond the bounds of possibilities. One, banks offering loans in small amounts. Two, banks lending to someone with Sherrill’s history. Nor did he receive any money from the Government or community service program.

Sherrill received the money from Advance Financial, his local payday and title loan lender. AF didn’t ask him to produce a lot of collateral. He nurtured his business and he believes that payday loans may have just rescued his life.

No obstacle had stopped him from owning his own business. Even his rap sheet wasn’t coming in his way to making his story a success.

“The Payday Lending industry has helped me achieve success. I owe a great deal of gratitude to them,” Sherrill’s throwback statement, in February, to a congressional committee. “Without them, my business would not have taken off with flying colors.”

After looking at the new rules proffered by the Consumer Financial Protection Bureau, Sherrill gave his testimonial in Washington, believing it to be an unprincipled and perhaps an unconstitutional agency developed by the Dodd-Frank financial law.

A protest was made by Sherrill about the agency was that it does not understand that real people take these loans to meet their basic necessities. He mentioned in a piece for The Hill that the Consumer Financial Protection Bureau agent at the meeting confessed that he had never stepped in a payday loan store.

“The CFPB claims to be a ‘21st-century data-driven agency’ aiming to take a market based approach.” Sherrill said. “For me, a market-based approach means direct communication with customers finding their requirements and needs.

People paid no heed to Sherrill’s plea. On June 2, the agency officially submitted the rule and experts believe that would drive up to 80 percent of existing lenders out of business.

The administration’s assertion is that borrowers get in dire straits by borrowing money they can’t reimburse. Industry statistics show that 80 percent of its loans are paid on the due date and more than 90 percent are done gradually.

If the financiers are fine with these numbers and customers are ready to pay the fees, why does the government want to shut down these legitimate companies?

They swear they’re helping us, but Robert Sherrill knows we’re more fortunate without their helping hand.

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Note: Robert received his loans from Advance Financial, whom he credits for taking a chance on him and providing the loans that helped launch his new business. At the time this article was written, Advance Financial offered payday loans. Today, Advance Financial offers FLEX Loans, an alternative to payday, installment and title loans that provides customers with an open line of credit where they can withdraw funds at any time (up to their credit limit) and can pay back gradually over time. For more information, visit