Rates
The predatory nature of payday loans in the U.S charge an average interest rate between 391% to 600% as an annual percentage rate. Although, these interest charges may increase for different states in the U.S. as per the usury laws and regulations.
For instance, 16 states in the U.S have banned payday loan provisions due to the rising inability of borrowers to repay the loans. According to statistics released by the U.S government agency – the Consumer Financial Protection Bureau says that almost 80% of loans do not get paid back in two weeks which leads to an increase in the debt amount due to soaring interest.
Consequently, a borrower might have to avail of additional loans to repay consolidated payday loans. Thus, in 2021 certain states in the U.S took measures to stamp out or clamp down on high payday loan interest rates. Continue reading