By Renato Rocha, Policy Analyst, Economic Policy Project, NCLR
Debt collection in the Latino community is a critical consumer protection issue for one of the nation’s largest and fastest-growing communities.
Latino families need access to affordable credit but have been historically excluded or discriminated from accessing safe financial products. The FDIC’s 2015 Survey of Unbanked and Underbanked households indicated that a result of this persistent economic injustice is that Latinos and other consumers who have been outside the financial mainstream are vulnerable to financial shocks, such as health-related expenses or job loss. Having been sidelined from affordable products, Latinos have little choice but to turn to more expensive credit to pay for their expenses. For example, 39 percent of Hispanic households used an alternative financial product (such as a payday loan) in 2015, compared to just 17 percent of White households.