Yesterday, a delegation from Prosperity Works traveled to Chama, NM to testify before the Indian Affairs Committee about the storefront lending industry in New Mexico. HB 347, passed last session, went into effect in January 2018, capping the interest rate at 175% on all payday and title loans. However, the Financial Institutions Divisions, charged with enforcing the Small Loans Act, has yet to implement a new regulatory process. Without clear rules, lenders may be finding loopholes that allow them to skirt the 175% interest cap.
Since it is impossible to know how well the new law is protecting New Mexicans, Prosperity Works is also petitioning to see the data lenders are compelled to report to the FID about the loan products they are selling.
In addition to capping the interest rate, the new law also requires lenders to provide clear information about the costs of loans, allows borrowers to develop a credit history when they make payments on small-dollar loans, and sets minimum contract terms for small loans, including at least four payments and 120 days to pay off most loans. "The data and reporting transparency we seek is necessary to close loopholes that could render HB 347 ineffective, and to augment existing consumer protections in New Mexico," says Michael Barrio, Prosperity Works Director of Advocacy.
Following testimony from Prosperity Works and the New Mexico Center on Law and Poverty, the Indian Affairs Committee passed a resolution asking the FID to provide a full report as well as a presentation to the committee later this fall.
The passage of HB 347 was a necessary step to protect all New Mexicans, particularly Native American communities who have been aggressively targeted by this industry. Prosperity Works continues to fight for increased consumer protections while working to make sure the existing laws are effective as intended.
Read thefull press release at the New Mexico Center for Law and Poverty.
Prosperity Works is excited to welcome a new member to our staff. Dara Romero has joined the team as our new Technology & Innovation Manager. Dara comes to us with experience in corporate HR, non-profit consulting and even experience owning a retail business! When Dara isn't hard at work at Prosperity Works, she manages her own socially conscious fashion line! Welcome, Dara. We're so happy to have you aboard.
Our Albuquerque-based team is hiring two positions. If you know a qualified candidate who enthusiastically upholds Prosperity Works’ vision for a future in which all New Mexicans have the knowledge, relationships and opportunities to thrive, please encourage them to check out these job postings:
Director of Development
Just five days away from New Mexico's June gubernatorial primary, and as all candidates focus on improving public education as the key to addressing crippling poverty in the state, I've been thinking much more about our approaches to realistically addressing poverty and building the capacities of our economy as well as our people. The asset-development movement of the 1990s posited that increasing a low-income family's assets - not just its income - encourages greater long-term financial stability. I believe that this focus on both income and assets provides a pragmatic framework for mitigating the sobering reality of poverty in New Mexico.
According to recent numbers from New Mexico Voices for Children, 27% of children in the state live at or below the poverty level and 38% live in single-parent families. These numbers more accurately contextualize the fact that New Mexico is one of the poorest states in the nation and magnify the urgency to reassess and rethink how New Mexico approaches poverty - how we talk about it and how we conceptualize solutions. In general, Republicans and Democrats seem to agree that education is critical to encouraging career mobility and financial stability, as well as a host of other psycho-social indicators and, subsequently, that addressing early childhood education is a top policy priority. However, our work as a State on related policy and legislation has stalled largely as a result of partisan dissension and bickering about approach and appropriations, but also because I don't believe we're taking advantage of existing innovations.
After the recent news about a bill before the U.S. House of Representatives that would cut funding for #SNAP by $20 billion over the next ten years while imposing strict new eligibility standards, I'd gotten to thinking about the last year in regard to social services.
The past year has seen a steady dismantling of the social safety net in the United States. Under the current administration, a series of policy decisions have been made that come along with strict assistance requirements. These kinds of restrictions cut across healthcare, food, housing, and cash assistance and run contrary to historical evidence against mandating work requirements. Finding and securing work under stricter requirements is far more difficult, not to mention the fact that work (or lack thereof) is the reason so many people find themselves in need of such assistance in the first place. Programs like TANF, SNAP, and Medicaid help people experiencing poverty get through hardships that can make maintaining employment exceedingly difficult - like mental illness, disability, domestic violence, etc..