How Title Lending Hurts Communities and How House Bill 300 Could Help

By Alex Camardelle, Ph.D., February 2025 

Title lending is a type of loan where people borrow money using their car title as collateral. While it might sound like an easy way to get cash fast, title lending often traps people in a cycle of debt. This problem hits low-income and rural communities the hardest.  

What’s the problem with title lending? 

Title loans often charge outrageously high interest rates—sometimes up to 300 percent a year. Many borrowers cannot keep up with the payments, which puts them at risk of losing their cars. Without a car, it’s harder to get to work, school, or even the doctor. Losing a car can start a domino effect of problems that pushes families deeper into financial trouble.  

Here’s what’s happening in Georgia: 

  • Economic impact estimates commissioned by Kindred Futures find that title loans drain $271 million from Georgia’s economy every year. Over the last 10 years, title lending is estimated ——— to have cost the state a whopping $2.6 billion. 
  • The research also found that title lenders are clustered in low-income areas and communities of color, with Gwinnett County having the highest concentration of title lenders in the entire state of Georgia. 
  • According to our estimates, title lending costs the state approximately 2,800 jobs each year because families spend so much on loan payments that they have less money to spend on things like groceries, clothes, and local businesses, which hurts small businesses and slows job growth.  

What is HB 300, and how does it help? 

House Bill 300 (HB 300) is a new proposal in Georgia that addresses title lending and the harm it causes. If passed, this bill would: 

  • Ban Title Loans: It would stop pawnbrokers from using car titles as collateral for loans. 
  • End Hidden Fees: HB 300 eliminates extra charges, like repossession fees, that make it even harder for borrowers to get out of debt. 
  • Protect Borrowers: The bill would make lending practices clearer and ensure borrowers understand to the terms of their loan agreement. 

Why you should care: 

Title lending does not just hurt individuals—it harms entire communities. Our recent research found that most predatory lending targets low-income communities with high uninsured rates, effectively taking wealth from people who can least afford it. By taking money out of these areas, title loans make it harder for families to build wealth and for local businesses to thrive, creating a cycle of entrenched poverty. 

What could change with HB 300? 

  • Families could keep more of their money to invest in what benefits them, like education, homeownership, or starting a small business. 
  • Communities could see more jobs and opportunities as people spend money locally instead of sending it to predatory lenders. 
  • Together we can create a more competitive economy that fundamentally works for all.  

A Step Toward Fairness: 

HB 300 is an important step towards a fairer financial system in Georgia.   By curbing the title loan industry, HB 300 could help protect families, support local economies, and create a better shot at community wealth building. 

Predatory lending is a big problem, but HB 300 shows that change is possible. Let’s keep pushing for policies that uplift communities and create a stronger, fairer Georgia for everyone. 

Kindred Futures BSO Capacity Building Cohort February Work Session

On February 11th, Kindred Futures’ Strategy & Impact team hosted a collaborative work session with the BSO Capacity-Building Cohort, a collective of 22 business-serving organizations (BSOs) working to strengthen the small business ecosystem. This convening addressed the challenges identified by BSOs, including funding, contract opportunities, data collection, and collaboration—critical factors in the success of Black-owned small businesses. 

This session was a direct outcome of the groundwork Kindred Futures laid last year to build a shared-results agenda for the region’s small business sector. Recognizing that BSOs play a critical role in the ecosystem, we have prioritized strengthening their capacity as an entry point to driving broader systems change.  

By deepening collaboration and aligning efforts, we are working toward an ecosystem that not only supports Black-owned businesses but also ensures they have the resources and opportunities to thrive.  

Key Takeaways & Next Steps from the BSO Capacity-Building Convening 

The session sparked insightful discussions and left participants with actionable strategies to strengthen support for Black-owned small businesses. 

Capital Deployment  

  • Most BSOs rely on external lenders for capital, sparking strong interest in collaborating on joint grant applications and partnerships to improve capital access. 

Procurement & Contracts 

  • Many small businesses struggle with government and corporate contract readiness, a challenge compounded by shifting political priorities, regulatory changes, and social pressures for equitable procurement. In response, plans are underway to develop joint partnerships among the BSOs that would establish a system to assess business needs, ensuring they are connected to the right resources to navigate these evolving dynamics. 

Data Infrastructure 

  • Inconsistent impact tracking among BSOs makes it difficult to demonstrate collective results. Implementing a standardized tracking system could enhance reporting and attract more investment. 

Policy & Advocacy 

  • A need to mobilize and engage local and state leaders to secure greater funding and resources. 

Collaboration & Shared Services 

  • There is strong interest in sharing resources like accounting, legal support, and training. A collaborative approach could lower costs and improve services for small businesses. 

Next Steps 

  • Deepen collaboration to enhance contract readiness. 
    Explore the creation of a shared lending fund to improve capital access. 
    Map out existing BSO services to identify gaps and align support. 
    Strengthen policy advocacy efforts to push for better funding and resources. 

By building on these insights and strengthening collaboration, we’re moving toward a more equitable, resilient small business ecosystem. Stay tuned as we continue this work! 

Kindred Futures Releases Policy Brief Proposing an End to the Economic Exploitation of Predatory Lending

ATLANTA, Jan. 20, 2025 – Today, Kindred Futures released its latest policy brief, “Trapped by Design: How Predatory Lenders Exploit Black Atlanta,” which explores the disproportionate clustering of predatory lenders, including auto title loan companies, in Atlanta’s majority-Black neighborhoods – causing compounding economic harm for residents. The report sheds light on the concentration of 67% of predatory lenders in Atlanta’s majority Black neighborhoods. According to Kindred Futures’ analysis, title loans cost Atlanta $128.2 million in lost annual economic output and 1,336 jobs each year. Statewide, Georgia loses $271.1 million in economic output and 2,796 jobs due to title loans.

“Predatory lenders don’t just operate in Black neighborhoods—they are deliberately concentrated in them, exploiting communities that have been systematically excluded from fair financial systems,” said Alex Camardelle, Ph.D., vice president of Policy and Research at Kindred Futures. “Atlanta must take bold action to curb the saturation of predatory lenders, strengthen consumer protections, and invest in community-driven financial solutions that actually build wealth rather than extract it.” 

Although Georgia banned traditional payday lending in 2004, title loans and high-cost installment loans continue to operate in the state, thriving in areas where traditional banks have intentionally chosen not to open branches, creating a financial void that predatory lenders exploit with high-interest loans that trap residents in cycles of debt and financial insecurity. These exploitative practices disproportionately target low-income communities and communities of color, deepening systemic inequities.

Kindred Futures is committed to building collective Black wealth. As a think and act tank, the organization is a solutions aggregator and influences capital movers. 

“The release of this research is a significant milestone in our work that underscores that economic exclusion and systemic racism impacts everyone,” said Janelle Williams, Ph.D., co-founder and CEO of Kindred Futures. 

Key findings from the report include: 

  • Our research highlights that predatory debt mechanisms are actively stripping opportunities to build wealth from Black communities in Atlanta.
  • The stress induced by financial predators does not stop at finances; it also has far-reaching effects on the health and well-being of families. 
  • Small-dollar lenders often prey on small businesses by offering loans with high costs and exploitative terms – targeting small businesses, especially those with limited access to traditional financing.

The brief also makes the following policy recommendations:

  • Cap interest rates on title and installment loans. Implement a statewide interest rate cap of 36% APR or lower on all title loans and installment loans, aligning with successful reforms in North Carolina, Colorado, and Illinois.  
  • Use zoning laws to limit the concentration of predatory institutions. Introduce zoning regulations in Atlanta and other municipalities to limit the density of predatory lenders in low-income neighborhoods. 
  • Create a statewide Community Development Financial Institution Fund. Establish a Georgia Community Development Financial Institution (CDFI) Fund to provide affordable, low-interest loans to underserved communities.
  • Create a City of Atlanta-run or statewide Community Development Financial Institution expansion program. The CDFI fund should offer tax breaks, grant funding and provide low-cost loans to support CDFIs to open brick-and-mortar branches in historically redlined neighborhoods. 
  • Strengthen enforcement against exploitative lending practices by closing loopholes that non-tribal lenders use to bypass state regulations under the guise of tribal affiliation and sovereign immunity. So-called “rent-a-tribe” schemes not only trap borrowers in predatory debt but also exploit tribal nations by using their sovereignty as a shield for harmful lending practices

Kindred Futures partners with Black Wealth Solution Providers, redefining wealth so that Black people have the opportunity to contribute to and accelerate a just and inclusive economy. That is our promise. We are connected and committed to new models of abundance because we know that investing in people pushed to the economic fringes, results in a thriving economies and communities.

Read the brief here.​

 

Building King’s beloved community by ending predatory debt in Atlanta

By Alex Camardelle

The Rev. Martin Luther King Jr.’s dream of the Beloved Community — a society built on justice, equality and shared prosperity — was as much about economic liberation as it was about civil rights. He understood that systems of exploitation, including financial injustice, were designed to keep marginalized communities trapped in cycles of poverty. On this Martin Luther King Jr. Day, we must reflect on how Atlanta, the city of King’s birth and work, still struggles under the weight of economic oppression in the form of predatory lending.

Predatory lenders, including auto title loan companies, cluster disproportionately in Atlanta’s majority-Black neighborhoods. “Trapped by Design: How Predatory Lenders Exploit Black Atlanta,” a recent report by Kindred Futures, reveals that 67% of predatory lending institutions in Atlanta are concentrated in majority-Black neighborhoods, despite these areas making up a smaller share of the city’s population. Meanwhile, just 33% of such businesses exist in wealthier, non-majority Black neighborhoods with greater access to traditional banking services. This stark imbalance is no accident; it is a deliberate strategy that thrives on systemic racial and economic inequities.

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