Fifth Third Bank is
making some changes to its short-term "payday loan" product to make
it a better deal for borrowers. Fifth Third, Cincinnati's largest locally based
bank, offers cash-strapped customers the ability to borrow money in advance of
their next paycheck. It lends up to half of a customer's monthly direct
deposits but no more than $1,000 at a time. Fifth Third shut off the Early
Access deposit advance service for new customers in
January. Customers who were already signed up for the program could continue to
use it.
It
said then it would rework the program. Now, it said Monday it will revise the
service starting Jan. 1. Fifth Third is cutting the transaction fee from 10
percent of the advance amount to 3 percent, it said Monday. It will also
increase the repayment deadline from 35 days to 45 days. And it will lower the
number of consecutive months that a borrower can reach the maximum credit limit
from six months to three. If borrowers hit their limit for three straight
months, they won't be eligible for another advance for 30 days.
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