The recession and weak recovery have been good to payday lenders. The Wall Street Journal published an article Wednesday that described how hard times have brought prosperity in the short-term lending and pawn industries.

Coincidentally, six Lincoln credit unions launch their "Credit Union Quick Cash" program Thursday as an alternative to what they call high-interest payday loans for consumers.

"Short-term, small-dollar loans are often a necessity for many people who are trying to make ends meet," Scott Sullivan, CEO of the Nebraska Credit Union League, said in a news release. "Unfortunately, the current market for these loans in Nebraska is primarily limited to high-cost paycheck advance loans. Credit Union Quick Cash will offer consumers a quick, convenient and low cost alternative."

The credit unions participating in Lincoln are Liberty First Credit Union, LincOne Federal Credit Union, MembersOwn Credit Union, Nebraska State Employees Credit Union, Peoples Choice Federal Credit Union and University of Nebraska Federal Credit Union. 

"We decided to pilot this program in Lincoln with the goal of spreading it to Omaha and across Nebraska," said Brandon Luetkenhaus, governmental and public affairs director for the Nebraska Credit Union League. "There is definitely a demand across the market for this product, but we believe that Lincoln was the right place to start the program."

Members of the participating credit unions will be able to apply for a $500, 60-day loan with an annual percentage rate of 18 percent. According to Financial Stability Partnership data presented by the league, the average payday loan in Nebraska has up to a 460 percent APR on a $500 loan with a payback term of 34 days.

A representative of the Nebraska Financial Services Association, the organization of payday lenders, could not be reached for comment.

"Many credit unions offer smaller loans, but this is a more universal, standardized program in which six credit unions, and any others that may join, have decided to abide by these terms and conditions," Luetkenhaus said.

Under Nebraska law, payday lenders, also known as delayed deposit services, can offer as much as $500 in loans against held checks for only 34 days at a time. 

But often the customer gets a new loan when paying off the old one or uses one loan to pay off another, according to regulators. Advocates for the poor have been campaigning against payday lending, which they consider predatory, for years, and the local Human Services Federation planned to make a presentation with the league at a news conference Thursday. Fifteen states have banned payday lending.

Credit union members will be able to obtain a Credit Union Quick Cash loan in minutes "without the hassle of a credit report," the league said.

Members are required to provide proof of income and by federal regulation are required to be or have been a member of the credit union for at least 30 days to qualify for the loan. There are no early payment penalties, the league said.

Credit unions are not-for-profit financial institutions that are owned by their members and federally insured by the National Credit Union Administration. The Nebraska Credit Union League is the trade association representing almost all of Nebraska's 72 credit unions and their 425,000 members.

Reach Richard Piersol at 402-473-7241 or