Payday Loan Calculator

Payday loans charge fees that translate to annual percentage rates of 260-780%, depending on the fee structure and loan term. A $500 payday loan with a $15 per $100 fee for 14 days costs $75 in fees. That same $500 borrowed on a credit card at 25% APR would cost about $4.79 in interest over two weeks. The payday loan costs roughly 15 times more. These loans disproportionately affect low-income communities, communities of color, and military-adjacent areas. The CFPB, state regulators, and consumer advocacy organizations universally classify payday lending as predatory. If you are considering a payday loan, the alternatives listed below will almost always cost less.

The payday lending business model depends on repeat borrowing. Industry data shows that lenders earn most of their revenue from the 80% of borrowers who roll over or re-borrow within two weeks. The median payday borrower takes out 10 loans per year, paying fees each time. A borrower who takes a $400 loan at $15 per $100 and rolls it over nine times (10 loan periods total) pays $600 in fees to borrow $400 for approximately 20 weeks. If that same borrower had access to a credit union PAL at 28% APR for $400 over 20 weeks, the total interest would be approximately $22. The difference, $578, represents the predatory premium. This money flows from borrowers who can least afford it to lenders who design products around repeat use.

Before resorting to a payday loan, consider these options ranked from least to most expensive. Earned wage access programs (offered by employers or apps like Payactiv and DailyPay) provide early access to money you have already earned, usually for free or for a small subscription. Cash advance apps (Earnin, Dave, Brigit) advance $50-$500 for tips or monthly fees of $3-$10. Credit union PALs charge a maximum 28% APR. Personal loans from online lenders serve borrowers with credit scores as low as 580 at rates of 15-36% APR. Credit card cash advances charge 25-30% APR plus a one-time fee of 3-5%. Local nonprofits, 211 hotline services, and community action agencies provide emergency grants with no repayment required. Even borrowing from friends or family, while uncomfortable, avoids the financial damage of predatory lending.

The most permanent solution to payday loan dependence is building a small emergency fund. Research shows that having just $400-$500 in savings prevents most payday loan usage. Start small: even $25 per paycheck deposited into a separate savings account builds to $650 over a year. Many banks and credit unions offer automatic transfers that move a small amount from checking to savings on payday, making the process invisible. Apps like Digit or Qapital automate small savings based on your spending patterns. Once you reach $500 in emergency savings, you have a buffer against the unexpected expenses, car repairs, medical bills, and income gaps that drive most payday borrowing. Building from $500 to one month of expenses ($2,000-$3,000 for most households) provides even stronger protection against financial emergencies.

Consumer protections for payday borrowers vary by state and continue to evolve. Eighteen states plus D.C. ban payday lending or cap rates at 36% APR, effectively eliminating the product. The Military Lending Act (MLA) caps loans to active-duty service members and their dependents at 36% APR, covering payday, title, and other high-cost loans. The CFPB has authority over payday lending at the federal level and maintains a complaint database where borrowers can report violations. In states that allow payday lending, common protections include limits on the number of outstanding loans, mandatory cooling-off periods between loans, and required extended payment plan options. If you believe a payday lender has violated your state's laws or federal rules, file complaints with both your state attorney general and the CFPB. Keep all loan documents, receipts, and bank statements as evidence.