Small-Dollar Loans

Since 2011, Pew’s small-dollar loans project has conducted extensive research on payday, auto title, and similar loans and found that the market is plagued by unaffordable payments, deceptive business practices, and excessive prices.

The Consumer Financial Protection Bureau—the federal agency charged with regulating these loans—has proposed a new rule. However, without changes, the regulation would allow payday loans with 400 percent interest rates to flourish while locking out lower-cost loans from banks that could save millions of borrowers billions of dollars.

Pew provides research, recommendations, and technical assistance to help state and federal lawmakers craft policies for a fair, safe, and affordable small-dollar loan marketplace.

Our Work

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  • From Payday to Small Installment Loans

    All of the largest payday lenders now offer installment loans, which are repayable over time and secured by access to the borrower’s checking account, in addition to conventional payday loans that are due in a single lump sum. This shift toward installment lending has been geographically widespread, with payday or auto title lenders issuing such loans or lines of credit in 26 of the 39... Read More

  • Pew Identifies 4 Risks in Shift to Payday Installment Lending

    WASHINGTON—The shift toward installment credit in the payday and auto title lending markets is creating new risks, but a draft rule proposed in June by the Consumer Financial Protection Bureau (CFPB) would not adequately protect borrowers because it does not keep pace with changes in the industry, according to an issue brief released today by The Pew Charitable Trusts. Read More

  • Will the New Federal Payday Loan Rule Give Consumers Better, Safer Options?

    Federal regulators have an opportunity to set rules for small-dollar lending for the first time, potentially saving American borrowers billions of dollars. The Consumer Financial Protection Bureau (CFPB) proposed a new rule for this market in June. Read More

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Media Contact

Sultana Ali

Officer, Communications

202.540.6188