Research & Analysis
The payday lending industry frequently supports what they call reform of their own industry in state legislative battles, because they know that most of the measures in debate will not slow the rate at which they can make repeat payday loans to the same borrower. Our report, Phantom Demand, shows how the industry depends on “churned” borrowers, those who have to take a new loan before their next payday, for three quarters of their business.
In public, payday lenders say their loans are for infrequent use. In private, they say things like this: "The theory in the business is you've got to get that customer in, work to turn him into a repetitive customer, long-term customer, because that's really where the profitability is." (Dan Feehan, CEO of Cash America, remarks made at the Jeffries Financial Services Conference, 6-20-07)
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- The NC Consumer Finance Act Needs No Adjustment
March 1, 2011
The Center for Responsible outlines the main reasons the North Carolina Consumer Finance Act needs no further adjusting.
- San Jose Payday Lending Poll
February 23, 2011
- Military and Payday
November 22, 2010
Military and Payday: Congress acted to protect military families from this predation by including a measure in the Defense Authorization Act of 2006 that prohibits payday and title lenders from charging higher than 36 percent APR.
- Map of US Payday Stores per Household
November 1, 2010
This color-coded map of payday stores by household reveals a disturbing pattern. Southern states are among the most targeted for these high-cost, low-dollar loans.
- Summary of the Military Lending Act of 2007
October 22, 2010
CRL summarizes the provisions of the Military Lending Act, which restricted the APR for certain types of loans to military personnel to 36%. The MLA covers payday loans, car title loans and refund anticipation loans.
- High-Cost Payday Lending Traps Mississippi Borrowers
July 26, 2010
The state of Mississippi is gearing up for a legislative battle as the expiration of a law approaches in 2012. If the law sunsets as scheduled, payday lenders will no longer be exempt from a 36 percent cap on annual interest rates. Payday loans carry rates of up to 572 percent and cost families $270 million in fees every year.
- Payday lenders pose as brokers to evade interest rate caps
July 16, 2010
In recent years, a growing number of states have enacted interest rate caps and other protections to eliminate abusive payday lending practices that trap consumers in long term debt. Payday lenders repeatedly evade these rules, finding new ways to maintain business as usual and continue to offer short-term loans with triple-digit interest rates. The latest form of subterfuge is one in which the payday lenders position themselves as brokers, seeking licensure under state-level laws designed to regulate credit repair organizations. Under this scheme, payday lenders charge the maximum interest rate allowed on the underlying loan plus an additional "broker" fee, typically ranging from $20 to $25 per $100, resulting in loans with an effective annual percent interest (APR) in excess of 500%.
- Comments on NCUA's Notice of Proposed Rulemaking on Short-term, Small Amount Loans
July 6, 2010
Comments of the Center for Responsible Lending on the Notice of Proposed Rulemaking on Short-term, Small Amount Loans from National Credit Union Administration--12 CFR Part 701--RIN 3133-AD71. Submitted July 6, 2010.
- Mainstream banks making payday loans
February 24, 2010
National bank regulator, the OCC, must stop this trend before it takes off among more national banks, making millions vulnerable to predatory loans even in states that don't allow it from payday lending stores
- Consumer Financial Protection Agency Could Have Stopped Abuses that Plague Americans Today
October 23, 2009
CRL shares stories of everyday people affected by financial abuse and emphasizes the need for the Consumer Financial Protection Agency to ensure that they and others are protected from such abuses in the future.