This map was created in GEO 441: Geographic Information Systems (GIS) for Community Development Summer 2017 by Andrew Kos. After a wave of bank deregulation in the 1980's, the gates opened for intense competition that forced less profitable community banks and branches out of lower income and minority neighborhoods, leaving a wide open market for alternative financial services to fill. By the 1990's, payday loan providers began to fill a large part of this market. Today, their storefronts have become a staple in the urban landscape particularly in lower income neighborhoods. While they’re carefully marketed as essential one time use tools for those short on cash, the business model can take advantage of those it serves. Often borrowers end up trapped in a cycle of debt, paying many times more in fees than the loan principal. Small dollar loans--in amounts such as those provided by payday loans--do fill an important financial need; however, lax regulation has allowed for many of these financial products to become predatory.
The Consumer Financial Protection Bureau (CFPB) provides an open database of complaints against financial institutions including payday lenders. Using this data, in conjunction with a number of studies and news reports, Andrew singled out Texas as a state with some of the most lax financial regulations as well as the highest number of complaints against payday lenders in the CFBP database. Houston had the most CFPB complaints of any city in Texas. Mapping the locations of payday lenders versus the locations of traditional bank branches in Houston, a pattern arises showing more payday storefronts in lower income Census tracts and areas with higher Hispanic or Latino populations. Bank branches also appear to have the opposite pattern, most often being found in tracts with higher income and lower Hispanic or Latino populations.
hispanic, latino, gis, payday, banks