The interest rates applied for payday loans are quite high. The short term of these cash advances often makes it difficult for customers to repay, and a lot of them end up paying the fees again and again. A few individuals end up applying for another loan from another store so that they might repay the original one. As the price for borrowing a sum that ranges from one hundred dollars to $500 for 14 days, a consumer must pay back the principal plus a fee that might range from $10-30 for every $100 borrowed. If a payday loan borrower cannot pay back the loan after two weeks, the loan can often be rolled over for an additional two weeks, if the consumer pays the fee once more. Despite the high fees, the businesses are successful and these companies offer billions of dollars in loans each year.

If the loans are so steep, why are the companies so successful?
 

• The appeal of payday loans can be explained by the typical minimum requirements of the stores that offer them. Applying for bank loans would save consumers a lot of cash, but bank financing and other, more formal, types of lending require some things that many would-be borrowers do not have. The prosperity of the cash advance industry can be stated in one word - simplicity.
  
  Standard minimum requirements to acquire a cash advance are:
  
  The consumer is required to be 18 years of age.
  The person must have no other outstanding advances from that store (in some states, from any other company.)
  The consumer is required to be a Citizen of the United States.
  The borrower is required to have a personal checking account.
  The consumer must have a current job that they have held for at least three months
  
  These lenders don't care if you have paid your Charge card bill late two times in the past six months. If you meet the minimum requirements listed above, they will almost certainly lend money to you, which is something that no bank or a credit union will do with as little to go on as the requirements that most cash advance stores require. It should be no revelation that these stores are hugely profitable; they will agree to take the patronage of nearly anyone. There is no credit inquiry, and these companies have no interest in seeing a FICO score. Cash advance companies don't care about other advances you have, or if you had a recent bankruptcy.
  
  The success of these stores indicates that convenience and ease of use is an important consideration in borrowing money. That convenience that draws customers to quick cash stores comes with a price, as these financial products have an average interest rate of 391% per year. Who wants to pay that?