by George C. Leef
In 2006 North Carolina joined a growing list of states that ban “payday lending.” Payday loans are small, short-term loans made to workers to provide them with cash until their next paychecks. This kind of borrowing is costly, reflecting both the substantial risk of nonpayment and high overhead costs of dealing with many little transactions. I wouldn’t borrow money that way, but there is enough demand for such loans to support thousands of payday-lending stores across the nation. They make several million loans each year.
But no longer in North Carolina.
For more on this article, go to The April 2008 edition of The Freeman, a publication of The Foundation for Economic Education
Photo: Unwelcome in West Virginia - A billboard near the foot the Bartow Jones Bridge in Henderson advertises payday loan services across the river in Gallipolis, Ohio. Payday loans were officially banned in West Virginia last year following an agreement with the attorney general's office. For more on the agreement, go to The West Virginia Record.