Long Beach, California cuts off check-cashing stores

[cashlenders]

The Associated Press
Article Launched: 07/02/2008 02:41:23 PM PDT


LONG BEACH, Calif.—Long Beach has put out the "no service" sign for check-cashing stores.

The City Council voted Tuesday for an immediate six-month moratorium on check-cashing and payday loan businesses while staff works up a new policy for allowing the businesses to locate in town.



Critics say the businesses charge high interest rates and fees that take advantage of poor residents.



Councilman Dee Andrews said the city already has too many check-cashing shops.



Opponents of the moratorium argue that the businesses only loan money for a short term and provide a needed service for the poor who might have to pay more for a bank loan.