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Payday loans have been increasing in popularity over the last decade.  With 12 million Americans using payday loans each year, you may be wondering, who is using payday loans in the USA?


Who Uses Payday Loans the Most?


  • Americans without higher education – 85% of payday consumers do not have a four-year college degree.
  • Renters – 58% of payday loan users rent their homes, 10% of all renters use payday loans.
  • Separated and divorced people are more likely to use payday loans.
  • Americans with lower incomes use payday loans the most.
  • Military and ex-military member. In 2017, 44% of all military service members used a payday loan at least once.



Younger Generations

All generations use payday loans but currently, predominantly Millenials and Generation-X members make up payday loan consumers in the USA. 


Student loans are among the key factors driving financial hardship. 

Gen-Xers entered a slow job market with a mountain of debt. Wages are not enough for younger generations to cover necessary expenses, and student debt adds to that burden. A study led by Northwestern Mutual stated that Millennials have $27,900 in debt on average. 

  • 52% of all borrowers are aged 25 to 44.
  • 9% of adults aged 25-29 have used a payday loan.
  • Just 2% of people over 70 have used payday loans.


Socio-Economic Status


Low-income Households

Percentages Americans in Each Wage Bracket Who Have Used a Payday Loan  

Payday lenders market their loans to low-income households.

Populations in low-income households are not able to provide the collateral needed to get a low-interest loan. As a result, the only options left available are high-interest-rate loans such as payday loans.

Payday lenders recognize this and purposely target the young and the poor. 

The study found that lenders put particular focus on targetting low-income communities close to military bases. 

Renters Not Homeowners

The Consumer Financial Protection Bureau asserts that renters are more inclined to use payday loans than homeowners.

The Bureau has also stated that married, disabled, separated, or divorced Americans are all typical consumers.



Payday loan borrowing is more common in cities. 7% of Americans who live in cities have used a payday loan.  Take a look at out guide to find out Which US States Apply For The Most Payday Loans? 

Urban – 7 (%) 

Suburban – 3

Exurban – 6

Small town – 6

Rural – 6


Payday Loan Users – Statistics


  • 12 million Americans use payday loan services each year.
  • The average income of payday loan borrowers is $30,000 annually.
  • 7 in 10 of those who take out payday loans use them for regular recurring expenses such as utility bills and rent payments.
  • The typical payday borrower is in debt five months out of the year.
  • Americans payday loan users borrow an average of $375.
  • On average, payday lenders pay $520 in fees to borrow $375.
  • 80% of payday loans are taken out within 2 weeks of paying off a previous payday loan.
  • 75% of payday loans are taken out by someone who has used them before.
  • 58% of payday loan borrowers have trouble meeting monthly expenses.
  • Only 14% of borrowers can actually afford to pay back their loans.
  • The average annual percentage interest rate (APR) for payday loans is 396%.


To find out more, read our article How Many People Use Payday Loans In The USA?