Governor’s Check-Cashing Rate Hike Slams Lower-Income Communities
FOR IMMEDIATE RELEASE: December 6, 2017
CHICAGO, IL— Austin community members gathered Wednesday, December 6, 2017, to speak out about Governor Rauner’s proposed rate hike for check-cashing fees at currency exchanges. The town hall meeting was chaired by Illinois Representative La Shawn Ford (8th), who partnered with Woodstock Institute, a leading not-for-profit that tackles financial injustices. The proposed double-digit increase, which was requested by the currency exchange industry who complained of declining profits, would strain traditionally underserved populations such as low-income people and communities of color.
For the Austin community, the rate hike is too much to bear. “We have a lot of challenges on the West Side of Chicago, and the lack of strong traditional financial services leaves some families vulnerable to a high cost to survive,” said Representative Ford, who serves as Chair of the House Financial Services Committee. “We need financial services, like the currency exchange, to be safe and affordable, because for many struggling families, it’s their only option.
African-American mother of four and POWER-PAC leader Tara Williams said, “I [have] been using the currency exchange for the past two years…to cash my child support checks for $41.25. They take out about $2.00 from each check in order for me to cash it.” Williams is both “frustrated” and harmed by the currency exchange’s current rates, “That’s money I can use for sanitary necessities, such as dish soap or laundry detergent for my family.”
“The impact of this proposed rate hike would be devastating for our families that are barely making ends meet,” echoed Rosazlia Grillier, co-chair of POWER-PAC’s Stepping out of Poverty campaign.
“It is expensive to be poor,” said Woodstock Senior Vice President of Policy Brent Adams, “Lower income folks are targeted with all sorts of fees: late fees, overdraft fees, credit limit fees, and check-cashing fees – to name a few. Lower income folks simply cannot afford this misguided rate hike.” During the administration of Governor Pat Quinn, Adams was the head of the agency that is now proposing the rate hike: the Illinois Department of Financial and Professional Regulation.
Senator Kimberly Lightford (4th), said,“The governor’s check cashing fee increase directly affects low income families. People living paycheck to paycheck or on a fixed income cannot afford to pay more for basic services and should not be used to increase profits for currency exchanges.”
“I join Woodstock, POWER-PAC, and Representative Ford today to activate the community to speak about their concerns as they relate to the proposed rate hike for check-cashing fees at the currency exchange,” said Representative Camille Lilly (78th). “We encourage everyone to call the governor and ask him to reject the rate hike. Our constituents’ dollars support their families, and these rates do not.”
The proposal will change check-cashing rates at currency exchanges as follows:
|Current Rate||Proposed Rate||Check Amount||Percent Increase|
|1.4%+$1.00||2.5% + $1.00||$100 or less||46%|
|2.25%||3.0%||$1250.01 or more||33%|
Read more about the proposed rate schedule, and its opposition here.