Knowledge Tree
payday lending
Also known as: payday loans
Facts (27)
Sources
The Impacts of Individual and Household Debt on Health and Well ... apha.org Oct 25, 2021 20 facts
claimDuring the COVID-19 pandemic, the combination of debt moratoriums, child tax credits, and stimulus payments was associated with a reduced volume of payday lending.
referenceWysen (2019) explored the connection between credit scores, payday lending, and health outcomes.
referenceN. Martin and R.N. Mayer authored the article 'What communities can do to rein in payday lending: strategies for successful local ordinance campaigns through a Texas lens,' which outlines strategies for local regulation of payday lenders.
referenceLee (2017) published a study on credit access and household well-being, specifically providing evidence from payday lending.
referenceLee J. (2017) analyzed the impact of credit access on household well-being, specifically focusing on payday lending.
claimThe growth of payday lending from the late 1990s through 2021 was accelerated by the consolidation of smaller operations and the securing of loans from commercial banks, public pensions, and private equity funds.
claimPayday lending operations consolidated and secured funding from commercial banks, public pensions, and private equity funds, accelerating growth from the late 1990s through 2021.
accountDuring the COVID-19 pandemic, a combination of moratoriums on debt, child tax credits, and stimulus payments was associated with a reduced volume of payday lending.
referenceMartin N and Mayer RN published research in 'Law and Contemporary Problems' detailing strategies for local communities to regulate payday lending, using Texas as a case study.
referenceK. Wysen published an analysis on how credit scores and payday lending impact health outcomes.
perspectiveThe 32 states that have not yet done so should join the 18 states that have passed a cap of 36% or lower on interest rates to reduce or eliminate payday lending.
measurementAs of 2022, 18 states have passed a cap of 36% or lower on interest rates to lessen or eliminate payday lending, while 32 states have not.
referenceAmericans for Financial Reform published a report examining the relationship between payday lending and the private equity business.
referencePayday lending access impacts household well-being, as evidenced in a study by J. Lee available via SSRN (accessed October 20, 2021).
perspectivePublic policy experts suggest that reducing the demand for high-cost loans, providing safe low-interest loans, and increasing public benefits are more effective strategies for managing unsecured debt than legalizing payday lending.
referenceAmericans for Financial Reform published a report examining the relationship between payday lending and the private equity business.
referenceAmericans for Financial Reform published a report in 2017 examining the relationship between payday lending and the private equity business.
claimPayday lending operations consolidated and secured funding from commercial banks, public pensions, and private equity funds, accelerating growth from the late 1990s through 2021.
claimDuring the COVID-19 pandemic, the combination of moratoriums on debt, child tax credits, and stimulus payments was associated with a reduced volume of payday lending.
referenceK. Wysen published an analysis on how credit scores and payday lending impact health outcomes.
New study estimates the effect of predatory-lending law ushakrisna.com 4 facts
claimBertrand and Morse (2011) found that providing additional information about loan terms to payday borrowers results in a reduction in loan take-up.
claimMorse (2011) found that borrowers living in areas with access to payday lending are more resilient to natural disasters.
claimAgarwal, Skiba, and Tobacman (2009) showed that payday borrowers maintain access to formal credit through credit cards while simultaneously paying very high interest rates on their payday loans.
claimMelzer (2011) utilized cross-border variation to analyze payday lending and found no evidence that the practice alleviates financial hardship for borrowers.
Financial Ethics 101: Predatory Lending - Seven Pillars Institute 7pillarsinstitute-org.sevenpillarsconsulting.com Jun 18, 2024 3 facts
accountDuring the Great Depression, salary buying was renamed 'payday lending', with interest rates becoming standardized at approximately 240 percent per year.
claimMajor firms operating in the payday lending industry include Ace Cash Express, Advance America, Advance Financial, and Check ’n Go.
measurementPayday lending amounts typically range from $50 to $1000.