Do State Regulations Affect Payday Lender Concentration?
26 Pages Posted: 22 Mar 2015
Date Written: March 20, 2015
Ten states and the District of Columbia prohibit the operation of payday loan stores, and thirty-one other states have imposed regulatory restraints on the controversial industry, ranging, for example, from caps on fees and loan amounts to the number of rollovers and renewals a borrower may execute. Given the importance of payday lenders to significant segments of the population, and the wide variation among state regulatory regimes, this paper attempts to assess the extent to which the concentration of payday lenders in a given county correlates to its regulatory environment, as well as to various financial and demographic variables. The paper employs a dataset that is unique to this area of study, obtained directly from each state’s appropriate regulatory authority.
Keywords: Payday Lending, Small Loans, Credit Issues
JEL Classification: G21, D10
Suggested Citation: Suggested Citation