SAN JOSE (KCBS) – The city of San Jose is looking at how to regulate the short-term, high interest loans offered by check cashing stores, City Councilman Ash Kalra said Wednesday.

The city council’s Rules Committee is studying the impact loans with an interest rate sometimes exceeding 400 percent can have on low-income city residents.

“The way these places market themselves is that they’re helping people get by. Really they’re helping them dig a deeper hole,” Kalra said.

KCBS’ Jane McMillan Reports:

Kalra said the city is considering whether to restrict the density of check cashing stores, and how late they should be allowed to stay open.

The Rules Committee has yet to set a date when the issue will go before the full city council.

San Francisco and Oakland already have such legislation on the books.

Calls to the corporate offices of Access Financial and California Check Cashing, two large pay day chains in San Jose, have yet to be returned.

(© 2010 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

Comments (5)
  1. Laurie Alford-Zorn says:

    My sister got involved with payday loans and ended up being suicidal over the situation. If it had not been f0or me payiong the 110000.00 that she owed i think she would have become another statistic. These predators should be put out if business.

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