This report-the first in Pew’s Payday Lending in America series-answers major questions about who borrowers are demographically; how people borrow; how much they spend; why they use payday loans; what other options they have; and whether state regulations reduce borrowing or simply drive borrowers online.
Twelve million American adults use payday loans annually. On average, a borrower takes out eight loans of $375 each per year and spends $520 on interest.
Pew’s survey found 5.5 percent of adults nationwide have used a payday loan in the past five years, with three-quarters of borrowers using storefront lenders and almost one-quarter borrowing online. State re gulatory data show that borrowers take out eight payday loans a year, spending about $520 on interest with an average loan size of $375.