The Selma, Ala. city council approve a six-month moratorium on payday and title loan businesses that will prevent new stores from obtaining licenses, according to city attorney Jimmy Nunn. The ordinance will not affect businesses with a current license.
The ban applies to payday loans, title loans, car title loans and other similar businesses. While the moratorium is in place, the city will compile statistics about payday and title loan stores operating in the city limits.
Planning and Development Director James Benderson said those numbers will include: how many stores are in the city limits, where the stores are located and any potential laws passed in the Alabama Legislature pertaining to the payday loan stores.
Supporters and those involved in the payday loan industry say the businesses offer a valuable service to people who need a small cash advance and have weak credit.
Critics say that the stores take advantage of the poor and many municipalities nationwide have enforced bans against them.