OGDEN -- Two local women are among a group that is angry about some new loans debuting at Utah credit unions.
Although the loans are advertised under a different name, those who are opposed to the offerings are calling them payday loans.
"I'm just highly offended and outraged that they would offer this kind of a loan," said Nancy Groshart, of Ogden. "I think it's worse than going to a payday loan place because at least they advertise that it's a payday loan."
Groshart is among a group that will protest this morning at 10 a.m. at a news conference sponsored by the Coalition of Religious Communities (CORC) in Salt Lake City in front of an America First Credit Union. She is a credit union and CORC member and has signed a letter to America First Credit Union.
As part of the news conference, members of CORC will present letters from credit union members asking their credit unions to cease offering predatory products.
A news release the group is sending out cites a report by the National Consumer Law Center released earlier this month.
"The report shows that eight Utah-based credit unions ... now are offering predatory payday lending type products to their members," the news release states. It goes on to state, "Payday loans are infamous for trapping consumers into a perpetual cycle of debt."
"These online loan products have high interest rates ranging from 254 percent to 312 percent annual percentage rate," it states.
One of these credit unions, according to the release, quotes an annual percentage rate as high as 876 percent.
Two local credit unions are named by the report and the news release.
They are America First Credit Union in Riverdale and Alliance Credit Union in Ogden.
Also named are Cyprus Credit Union in West Jordan, Family First Federal Credit Union in Orem, Heritage West Credit Union in Tooele, Mountain America Credit Union in West Jordan, Southwest Federal Credit Union in St. George and USU Charter Credit Union in Logan.
Gerry Oborn, maketing director for Alliance Credit Union in Ogden, said the product her institution is offering is designed to serve a certain high-risk population and that loan officers there would not offer the product to members who have good credit.
"We would always, always try to seek an alternative way for a member to get the very best rate that they can," she said.
In reference to the higher-interest loans, Oborn said she understands CORC's concerns but the new loans are an effort to assist a certain demographic that wants and uses such products.
"If the credit unions have the ability to help them change their lifestyle, that's what we want to do," she said.
Oborn said it is the goal of her credit union to consult with anyone who sought out these products in an effort to help them avoid such circumstances in the future.
"It's developed as a new product to try and get people out of that cycle," she said. "(Payday lending) becomes a lifestyle, and we can't break that until we help them."
Scott Simpson, president of the Utah League of Credit Unions, said word of the news conference was disconcerting to him.
"Credit unions have not normally been in this business," he said. "There has been a great deal of clamor from consumer organizations that want our alternative to payday loans," he said. "It seems that they are not happy with the alternative."
Jerry Jaramillo, supervisor of savings and loans and trusts at the Utah Department of Financial Institutions, said all the credit unions named in the CORC news release are federally chartered and not examined by the state of Utah.
But he did say they are responsible for disclosing their rates as required by Utah law.
Jaramillo said his department strives to help consumers make good decisions on their interest rates by giving frequent presentations to various groups to educate them on knowing how the interest rates they pay will affect them.
"They should be aware of what the going rate is," he said. "You should be able to make the comparison that this is a high-rate loan."
But Anita Brooks, of Mountain Green, who is a credit union member, said she is angry about the high-interest loans.
"I think they are taking advantage of the financially illiterate of the public because they are so vulnerable in this economy," she said.
A retired member of the military, Brooks said she believes the loans are unpatriotic because of the high concentration of military personnel in the area.