Payday lending, which provides consumers an advance on their paychecks, has boomed in the last 20 years. This guide contains statistics about payday lenders in the United States. So, how many payday loan stores are there in the USA?
As of 2020, there are around 23,000 payday lenders in the United States. For comparison, that’s more than double the number of McDonald’s restaurants in the country. New recent regulations on payday lending hope to reduce these numbers. The Consumer Financial Protection Bureau (CFPB) estimates that these stipulations will begin to stabilize the payday loan industry. Loan volumes are expected to reduce by about 65%, and the number of storefronts to decrease by 71%-76%.
Online stores have seen a particularly sharp increase of usage. Every year, $9 billion is paid in payday loan fees. The CFPB hopes to see the amount of payday loan stores decrease dramatically, particularly in the current COVID climate. With the financial struggles that the coronavirus has brought about, around 3% of Americans say they’ve had to borrow cash using a payday loan, deposit advance, or pawn shop loan.
Are there payday loan lenders in my state?
According to the CFPB, 32 states allow these types of lending without significant restrictions. There are 12 states — Arizona, Arkansas, Georgia, Maryland, Massachusetts, New Jersey, New York, North Carolina, New Mexico, Pennsylvania, Vermont, and West Virginia — which do not have payday loan lenders. In these states, payday loans are entirely illegal. In the states which allow payday lending, some have strict restrictions. There are 16 states and the District of Columbia which implement caps on interest rates at 36%.
Which states have the most payday loan storefronts?
One research into the statistics on payday lenders look at the numbers of payday storefronts in each state per capita. According to their data, the most payday lenders can be found in California (2,451), Tennessee (1,344), and Mississippi (1,100). The research also states that the highest concentrations of payday loan businesses per 100,000 people are in New Mexico (41.78), South Dakota (40.01), and Mississippi (38.67).