Payday and Other Small Dollar Loans

Payday loan apps offer small, short-term loans that are typically repaid on the consumers’ next payday. These products are sometimes called Earned Wage Advance, Early Wage Access, or EWA but few merit this name. Research by CRL and others has demonstrated using these apps leave many consumers worse off - paying high fees for small loans, increasing their risk of...

Payday loan apps, often marketed as a low-cost or even “free” way to access wages early, are anything but. This one-pager explains how common features, such as expedite fees, so-called “tips,” and repeated small-dollar transactions, drive up the true cost of borrowing, resulting in triple-digit annual percentage rates for many users. This resource shows how the business model depends on...

The Military Lending Act (MLA) provides protections for active-duty service members and their families, including a 36% interest rate cap. This one-pager examines how payday loan apps, often marketed as Earned Wage Advance, attempt to evade these protections by claiming they are not loans. It also highlights a growing body of court decisions rejecting those claims and recognizing these products...

App-based Payday Lenders violate the Military Lending Act (“MLA”) by saddling military servicemembers with triple-digit debt. Multiple courts have rejected the lenders’ efforts to avoid compliance with the MLA. CRL is proud to stand with the servicemembers who wear the uniform as they fight unlawful high-cost debt-trap lenders that target their ranks. CRL filed a “friend of the court” brief...

CRL responded to the Federal Reserve Board regarding the Enova/Grasshopper merger, requesting the application for a bank holding company to be deny, or in the alternative, additional time of up to 60 days to comment, and to hold public hearings. This request is based on Enova’s record of high-cost lending of products that have interest rates over 100% and a...

CRL responded to the OCC regarding the Enova/Grasshopper merger, requesting additional time of up to 60 days to comment, and to hold public hearings. This request is based on Enova’s record of high-cost lending of products that have interest rates over 100% and a history of federal and state enforcement actions against them.

A coalition of more than 170 consumer, faith, civil rights, labor, human rights, and community advocacy groups sent a letter to Senators Elizabeth Warren and Tim Scott to enthusiastically support the Predatory Lending Elimination Act (S3793). This bill, sponsored in the Senate by Senator Jack Reed, is the solution to the worst practices by predatory lenders in the consumer loan...

Read our new analysis of borrowers caught in an unaffordable cycle of refinancing, including instances of refinancing two to three months after taking out an OppFi loan.

A recent study (commissioned by EarnIn) analyzing data from EarnIn’s Cash Out product has been promoted as evidence that the payday lending app marketed as earned wage access (“EWA”) improves workers’ financial stability by increasing income. A closer reading of the study, however, reveals the opposite: the reported income increase is likely driven by workers supplying more labor, while the...

Minnesotans had been charged a 220% APR on the typical storefront payday loan, but this predatory form of credit ended in 2024 when a strong interest rate cap went into effect.