Access to credit for many New Mexicans has been a topic of debate in Santa Fe for years, and with the economic turbulence imposed by COVID-19, the debate continues.

When lawmakers and regulators address critical issues like this, impacting access to credit for the most vulnerable New Mexicans, consumer protections must be prioritized.

Public-health orders created winners and losers in our labor force, with the winners held harmless as their incomes and benefits went unfettered. The losers, on the other hand, have seen honorable stimulus efforts come and go as Omicron and Delta have relentlessly purged our labor force.

While COVID-19 eliminated paychecks for many of New Mexico’s poorest, it did not eliminate everyday costs of living such as gas, car payments and medical emergencies.

This was compounded if you fit the label “non-essential” employee over the early years of the pandemic, in which case you probably experienced the added pressures of watching access to traditional credit disappear.

New Mexico legislators are debating the merits of the 36 percent rate cap on small dollar loans that could drive reputable small dollar lenders to cease offering their services here in New Mexico.

While this issue is complex, I do believe it’s possible to lower rates and increase consumer protections in a responsible way that would not harm access to credit in the communities that need it most.

I’m wading into this debate because I have seen reports that New Mexico’s credit unions reportedly are ready to step up and fill the credit void for our under-served neighbors.

I applaud the idea that the credit unions have hinted their involvement is forthcoming, however, as a former mayor and legislator, I have heard promises like this before and far too many are not kept.

If the credit unions are comfortable lending at 36 percent, why were they not offering lending options below the current 175 percent rate when it would have been even more helpful to consumers for more competitive rates?

I encourage them to implement this model and start lending today. Clearly, they do not have to wait for legislation to pass to permit them to do so.

Policy cannot be crafted based on promises. If the credit unions were to under-deliver on their promise, low-income communities would be left with no safe and trustworthy credit options.

There’s too much at stake to act carelessly when setting policy that will impact the financial stability of our communities.

Our leaders in Santa Fe have to respond responsibly and act to expand access to credit, not restrict it. Rushing toward a politically expedient solution to cap rates will not secure long-term protections or continued access to credit.

Leadership in Santa Fe should continue to bring advocates and industry alike to the table to reach a compromise on true and productive regulation for the benefit of the families and communities we serve.

Doing this will better serve us all in the end.

Tom Swisstack
Rio Rancho