>>>Never thought I'd see the day. Glad to see this happen - these types of businesses are nothing other than loan sharks.
>>>
>>>http://www.businessweek.com/news/2014-12-16/ferrari-racing-loan-mogul-said-to-face-racketeering-case
>>
>>For really financially distressed people payday loans are sometimes their only access to credit as banks have clamped down on lending. Its easy to say then they should just not borrow the money but i suspect a lot of payday loans are spent on basics like food and heat.
>
>I agree that there is a market and need for such a service - small & short-term loans - but when it's like 700% interest I have issue with that. I think congress was tried to close some of the loopholes in the laws that have allowed this to happen.

Quite a few years ago I had a client who was a Money Mart franchisee. Payday loans were just being introduced and in the early days it was an exceptionally nasty, unregulated business. The story he told me was that MM didn't want to go into payday loans but they felt, believe it or not, they were morally obliged to:

- they could offer better rates and more consumer-friendly terms so they'd put the real scumbags out of business

- at the time I believe they offered small amounts for short terms for free - to help out those people with short-term emergencies, arguably one of the sole use cases for payday loans. Looks like they still have a "free" offer: https://www.moneymart.ca/free?intcid=200loan_masthead , not 100% sure what "free" means these days. The fine print on that page is enlightening :(

I imagine MM makes money from its payday loan business but it's somewhat interesting that (if true) their justification in entering that business was, basically, harm reduction.