Policy Advocacy Brief
Issue Statement/Executive Summary
Payday lending is a service that was intended to provide emergency financial relief to those who cannot afford an unexpected expense. However, 7 out of 10 borrowers use loans to cover monthly living expenses such as rent, utilities, and maintaining food security. With steep annual percentage rates averaging 391% and subsequent repeat borrowing, communities targeted by predatory lending companies fall deeper into the cycle of debt. Minnesota must reform their policies surrounding payday lending implementing legislative changes to protect Minnesotans who rely on payday loans and invest in long-term solutions that eliminate the need for a payday loan.
Colton, C., Luker, K., Haarstad-Mead, A., & Turpen, S. (2022). Payday lending: Reforming this predatory practice in Minnesota. MSW Program Policy Advocacy Briefs, Minnesota State University, Mankato. https://cornerstone.lib.mnsu.edu/msw-student-policy-advocacy-briefs/42