Payday Lending: New Research and the Big Question

  title={Payday Lending: New Research and the Big Question},
  author={John P. Caskey},
  journal={Institutional & Transition Economics Policy Paper Series},
  • John P. Caskey
  • Published 2010
  • Business
  • Institutional & Transition Economics Policy Paper Series
Payday lending is controversial. In the states that allow it, payday lenders make cash loans that are typically for $500 or less that the borrower must repay or renew on his or her next payday. The finance charge for the loan is usually 15 to 20 percent of the amount advanced, so for a typical two-week loan the annual percentage interest rate is about 400 percent. In this article, the author briefly describes the payday lending business and explains why it presents challenging public policy… Expand
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