I’d rather sell my organs on the black market than get a payday loan.

There’s something all too seedy about them. The fact that they’re mainly found in low-income neighborhoods doesn’t help. It’s obvious these lenders are taking advantage of cash-strapped residents. As a product of these types of neighborhoods, such blatant exploitation only makes me resentful.

I’ve never heard anything positive about this form of lending. With triple-digit interest rates, why would anyone be pro payday loan?

The answer is easy: People are broke and willing to do anything for cash — even if it means owing $900 in interest on a .75 cent loan.

Despite the stigma associated with payday loans, with so many Americans floundering in debt, these loans are becoming tempting to even the most cautious person. As a result of its burgeoning popularity in the mainstream, the pay down loan industry is starting to appear outside of your area pawn shop and check-cashing place.

Indeed, some of the nation’s largest banks are starting to market payday loan-like services to their customers.


Yes, complete with triple-digit interest rates.

Minneapolis-based U.S. Bancorp, Wells Fargo & Co. of San Francisco, and Fifth Third Bancorp of Cincinnati are becoming the new pimps of payday products. What prompted the move?

Well, the legislation that imposed new federal regulations limiting credit card interest rates goes into effect in a few months. Given that banks are the biggest issuers of credit cards, they have to make up for the drop in profits somehow. Why not do so by throwing their hands into the $35 billion a year payday lending market?


National consumer groups have accused these banks of skirting state laws that limit outrageous interest rates. But I think most of us have grown to realize that when it comes to dancing around the law, the banking industry is the Janet Jackson of the financial world.

Some have called the bank industry’s move into payday loans a good thing – arguing that it forces storefront lenders to compete and offer lower interest rates at a time when people need cash the most.

The Star Tribune reports that each of the aforementioned banks charge $10 per $100 borrowed, which translates into a 120 percent annual interest rate if borrowers pay off the loans in a month.


By contrast, the storefront lender charges $17 per $100 borrowed — an annual rate of roughly 200 percent.

Is that change you can believe in?

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Michael Arceneaux hails from Houston, lives in Harlem and praises Beyoncé’s name wherever he goes. Follow him on Twitter.