As states across the nation including Colorado have taken steps to crack down on predatory payday lending practices, the lenders have forged alliances with what might at first seem like unlikely allies.

Some of the nation's largest banks have become a critical link between payday lenders and borrowers, enabling lenders to skirt state laws that put caps on interest rates, according to The New York Times.

It's time for federal lawmakers to take steps to ensure lenders cannot use the Internet and enlist the cooperation of big banks which stand to make a tidy profit off fees to get around state regulatory efforts.

Colorado lawmakers in 2010 passed a number of restrictions intended to curb outlandish interest rates and terms that trap borrowers, many of them living paycheck-to-paycheck, in a debt spiral.

Payday loans are a convenient, short-term option for people who want to quickly raise cash. However, that convenience comes with a price, in terms of interest rates that can reach 300 percent or more when calculated on an annual basis.

About 12 million people annually get payday loans, according to a survey by The Pew Charitable Trusts. Almost a quarter borrow online.

A story Sunday in The Times spelled out how banks, including JPMorgan Chase and Wells Fargo, allow lenders to make electronic withdrawals from borrower accounts even in states where payday loans are banned, and sometimes even after borrowers have pleaded to stop the withdrawals. Federal law gives borrowers the ability to stop automatic withdrawals when they want.

Several U.S. senators, including Tom Udall, D-N.M., and Jeff Merkley, D-Ore., recently introduced a bill that would force all lenders that conduct their business online to follow the rules of the state where the borrower resides. The measure also would give the Consumer Financial Protection Bureau authority to shut down lenders who violate state and other consumer laws via the Internet.

Colorado lawmakers worked hard to reform laws in 2010 so borrowers would be protected from the most egregious lending practices.

Changing federal law to give weight to reforms passed in Colorado and other places would enable these state-based solutions to be enforced.

The Denver Post, Feb. 27