Combating Payday Lending in Mississippi

Payday lenders can charge fees of $22 per $100 borrowed for a two-week short-term loan, which is the equivalent of a 572 annual percentage rate. Borrowers frequently cannot repay their original loan and have to take out additional loans, trapping the borrower into a cycle of debt. Mississippi has one of the highest concentrations in the nation, and attacking the abusive nature of predatory payday lending in Mississippi requires a coalition of multiple stakeholders who can energetically work together to limit the use of payday lenders. The Capstone team developed a four-pronged strategic plan to meet both short- and long-term needs and includes strategies for legislation, community organizing, financial literacy, and identifying financial resources to support alternative loan products.