Latest battle over California lending market: Should grocery stores offer large loans?
LOS ANGELES - Walk into a Northgate supermarket and, along with produce and pan dulce, you can walk out with a small loan from the store's Prospera financial services stand.
Those loans top out at $2,500. Now, a bill working its way through the state Legislature could boost that maximum to $7,500 - enough, the bill's author said, to pay for an immigration lawyer or a funeral.
The loans are marketed by Northgate but actually made by Insikt, a San Francisco firm that argues the change would help working families and small-time entrepreneurs while disrupting California's increasingly expensive market for personal loans. Lenders commonly charge interest rates higher than 100 percent, while Insikt, if the bill passes, would be able to charge no more than 35 percent, plus fees.
