Recent data from the Colorado attorney general’s office shows that the number of payday loans in the state increased slightly from 2011 to 2012. Under rules by the Colorado General Assembly, payday lenders cannot offer loans larger than $500 or charge interest rates greater than 45 percent. Although the borrowed amount for individual payday loans has increased, the number of businesses offering the product in Colorado has declined.
The AG's office reported 287 payday locations in the state as of 2012; but the tally is now closer to 200, a decline attributed to the 2010 law. Before the law passed, a borrower might take out a two-week, $500 loan at a fee of $75. Now, that same two-week loan would generate $10.29 instead of $75, although costs would be higher if the $500 loan were paid back in six months. With the decline in storefront lenders, many consumers are finding credit over the Internet, where unlicensed companies do not have to report fees or charges to a state agency.