What Do You Know About Poverty in Missouri?

11. In 2010, the average annual percentage rate (APR) on a Missouri payday loan was ____%.

c. Correct!

In 2010, the average percentage rate on a Missouri payday loan was 445 percent! Millions of people in need have used payday loans to obtain small amounts of money (usually $100 to $300). Lenders charge extraordinarily high percentage rates, sometimes as high as 2,000 percent. Many people fall into a cycle that seemingly cannot be broken when they are not able to repay the loan on time and must pay a fee (often around $17 per $100) to extend the loan. At this rate, it is easy to see how someone could owe hundreds, or even thousands, of dollars over time.

Source: Missouri Division of Finance. (2011). Report to General Assembly pursuant to section 408.506 RSMo. Retrieved January 20, 2011 from http://finance.mo.gov/consumercredit/documents/2011PaydayLenderSurvey.pdf.