Payday Loans: What Are They, Who Uses Them, and Why?

Payday Loans: What Are They, Who Uses Them, and Why?

Pew's Safe Small-Dollar Loans Research Project seeks to identify and analyze borrowers' needs, expectations, and experiences when it comes to small-dollar credit. It also researches a variety of loan products and the business models used by their providers, with a focus on studying the impact on borrowers.

Twelve million Americans take out payday loans each year, spending approximately $7.4 billion annually at 20,000 storefronts and hundreds of websites, plus additional sums at a growing number of banks.

To learn more about payday loans, including how they work, who uses them, and why, watch our two videos explaining payday loans. 



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Data-driven policymaking is not just a tool for finding new solutions for emerging challenges, it makes government more effective and better able to serve the public interest. In the coming months, President Joe Biden and the 117th Congress will tackle a number of environmental, health, public safety, and fiscal and economic issues—nearly all of them complicated by the COVID-19 pandemic. To help solve specific, systemic problems in a nonpartisan fashion, Pew has compiled a series of briefings and recommendations based on our research, technical assistance, and advocacy work across America.