Majority of American Christians think payday loans are a sin, says survey

CB Condez Sunday, April 17, 2016

Predatory lending is a "sin," said more than three-quarters of Christian respondents in a recent survey.

LifeWay Research conducted a survey from Feb. 1 to 15 in 30 states where there is little or no government regulation on payday loans. Of the 1,000 self-identified Christians who responded, 77 percent said that "it's sinful to lend money in a way that harms the borrower financially," while only 11 percent think it's immoral.

Stacks of U.S. hundred dollar bills in Mexico City November 22, 2011. | REUTERS / Bernardo Montoya

The Consumer Finance Protection Bureau defines payday loan as a short-term loan that is typically due by the next payday. People can borrow small amounts of money, around $500 or less, but they usually have to write a check for the full balance. While payment is expected to be paid in full, arrangements can sometimes be made so a borrower can pay in installments. The finance charge is somewhere from $10 to $30 for every $100 dollars loaned, equating to something like 400 percent annual percentage rate. Credit cards, on the other hand, change somewhere from 12 to 30 percent.

Sixty-two percent of the survey participants described payday loans as expensive, 37 percent said it's harmful, 33 percent said it's predatory, while 16 percent said it's helpful. Only 17 percent said they have taken a payday loan.

In a statement reported by Christian Post, Barrett Duke, vice president for public policy of the Ethics & Religious Liberty Commission of the Southern Baptist Convention, said that it is shameful for people to enrich themselves by "increasing the burden on the poor."

"The Bible speaks clearly in its opposition to usurious lending practices," Duke said. "Those involved in providing financial services to poor and vulnerable people have a moral responsibility to ensure that they are really helping them and not merely profiting from them."

In the survey, 86 percent said that "laws or regulations should prohibit lending at excessive interest rates," and 94 percent think lenders should make interest rates reasonable. Churches should provide counseling on this matter, said 56 percent of the Christian respondents, while 27 percent think churches should give gifts or loans to those in financial need.