What we know about payday loans in Kansas.
Payday loans charge too much interest and are a debt trap.
Four in ten Americans have no savings to help them weather a financial emergency. For Kansas residents facing a financial emergency, having bad or no credit history can leave them with limited options and they often turn to pay day loan institutions, getting trapped into paying up to 391% interest. The nature of the payday loan product is misleading and predatory.
175,000 Kansans a year use payday loans.
The average borrower signs up for a two-week loan but remains in debt for half the year.
Payday loan reform will save hard-working Kansans tens of millions of dollars each year.
Who are payday loan borrowers?
The millions of Kansans who have borrowed from a payday lender include families who are rural, urban, single parents, veterans, and others. All Kansas residents are impacted because more than $100 million is going to mostly out-of-state lenders, while that money could be reinvested in Kansas.
One out of 10 Kansas adults has taken out a payday loan.
Borrowers are mainstream consumers. It is required to have a checking account and income to get a loan.
Seven in ten borrowers report using the loans to cover basic household expenses.
"Does America have a savings crisis?"
https://www.washingtonpost.com/business/2019/02/21/does-america-have-savings-crisis/ Accessed March 28, 2019.
“Payday Lending Abuses and Predatory Practices” Center for Responsible Lending. Accessed March 28, 2017.
“Payday and Car Title Lenders Drain $8 Billion in Fees Every Year” Center for Responsible Lending. Accessed February 15, 2017.