Contact: Giselle Barry (Markey) 2022242742

Legislation would require financial institutions on military bases to offer financial tools that promote savings and reduce need for payday loans

 

Washington (November 20, 2013) - In an effort to help servicemembers and their families cope with the unique circumstances that often jeopardize their financial stability, Senator Edward J. Markey (DMass.) today introduced the Military Savings Act, legislation to promote savings rates among military servicemembers and decrease their need to turn to predatory payday lenders in times of financial crisis. The legislation establishes a pilot program in which financial institutions operating on military bases will offer innovative financial products to help troops and their families improve their financial situations. Senator Markey also offered the bill as an amendment to the National Defense Authorization Act (NDAA) currently being debated in the Senate. 

 

"Our troops are heroes, but sometimes even heroes need help," said Senator Markey, a member of the Commerce, Science and Transportation Committee. "When we offer innovative savings tools for our troops, we can help ensure that military families facing unexpected expenses don't have to turn to predatory payday lenders. As our brave men and women in uniform work to protect us, we must help protect them from financial scams that could drain their savings. I look forward to working with my colleagues to help ensure that our brave men and women in the military have the resources they need to be financially secure and succeed."

 

A copy of Senator Markey's legislation can be found HERE .

 

"The Consumer Federation of America (CFA) applauds the introduction of the Military Savings Act of 2013 that would establish a pilot program to develop innovative consumer financial products that encourage savings and wealthcreation among activeduty servicemembers," said Tom Feltner, Director of Financial Services, Consumer Federation of America. "Institutional efforts by the DoD to spur the creation of innovative savings tools will not only help increase the financial security of military families, but will reduce demand for abusive, highcost loans and strengthen military readiness."

 

Military servicemembers are three times more likely than civilians to resort to predatory "payday" loans that charge exorbitant interest rates. And in one military study, 27 percent of military families carry $10,000 or more in credit card debt, compared with 16 percent of civilian families. According to a report released by the Consumer Federation of America, although the Military Lending Act passed in 2007 has reduced abusive lending, servicemembers are still exposed to many dangerous loans that threaten their financial wellbeing.