Testimony of Bishop Joe Vásquez on PayDay Loan Bill

Bishop Vásquez will be providing the following testimony before the Senate Business and Commerce Committee today.
My name is Bishop Joe Vásquez. I am the Bishop of the Diocese of Austin and I am testifying today on behalf of the Texas Catholic Conference, the Roman Catholic Bishops of Texas, in support of SB 253.
In the teachings of our faith, we have many warnings about usury and the exploitation of people. Catholic Social Teaching demands respect for the dignity of persons, preferential concern for the poor and vulnerable, and the pursuit of the common good. These principles, coupled with our teaching on economic justice, lead us to question current payday and auto title lending practices.
A CSO, or Credit Services Organization, should help people clean up bad credit. Instead, the Texas law governing CSOs is being exploited as a loophole. Payday and auto title loan operators use it to charge high fees for loans that trap people in debt. By claiming that they are not lenders, they use this loophole to circumvent Texas laws that cap rates and fees for consumer loans.
Lending models should provide fair and helpful loans for families in need. The growing number of payday and auto title lenders in Texas may be doing more harm than good for persons in need of short-term cash loans. The stated purpose of payday loans is to offer a solution to families who face a short-term crisis. Instead of promoting the financial stability of consumers, however, payday lenders operating in the current system actually benefit more from their consumers' financial failure than their success. These practices are unjust and risk collapsing the stability of the family.