Currency Exchanges Pushing Fee Increase
State financial regulators are recommending an increase in the fees that currency exchanges charge for cashing checks. Opponents say it will hurt Illinois' poorest residents.
Currency exchanges petitioned the state for the higher rate — which could be up to 3 percent, depending on the amount of the check.
They say the move to direct deposit and pre-paid cards has cut into profits — putting the industry into decline.
But Democratic state Sen. Jacqui Collins, from Chicago, says it’s “unconscionable” to put the burden of making up for lower profits on people who are the most financially vulnerable.
“I see this rate hike for cashing checks as essentially a regressive tax," Collins says.
She’s urging a “tiered” approach — allowing higher rate for personal checks, but keeping lower rates for government checks, which are basically risk-free.
The plan still has to get through a special legislative committee that evaluates proposed regulations.