What is the typical APR on a payday loan?

$15 fee per $100 borrowed for a 14-day term = 391% APR. Some states cap fees; others allow rates of 400-600% APR. This is 15-25x the rate on a credit card with a high APR.

What are the alternatives to payday loans?

Credit union payday alternative loans (PALs): max 28% APR. Employer payroll advances (often free). Credit card cash advance (high but far less than payday). Local nonprofits with emergency lending programs.

Why do people use payday loans despite the high cost?

Payday lenders have minimal credit requirements, instant approval, and serve the unbanked. FDIC studies show payday loan users often have no other credit access. Financial literacy and emergency savings are the structural solutions.

Payday Loan True APR Calculator

Calculate the annualized APR of payday loans. A typical $15 fee per $100 for 2 weeks translates to 391% APR. Shows the true cost and alternatives.

Principal ($)

Annual Rate (%)

Years

Compounding / Year

$ Finance Disclaimer: These calculators are for educational and illustrative purposes only. Results do not constitute financial advice. Consult a licensed financial advisor before making investment or borrowing decisions.

How to Use

Enter the values for the scenario you are assessing. Calculate the annualized APR of payday loans. A typical $15 fee per $100 for 2 weeks translates to 391% APR. Shows the true cost and alternatives. Use the payday loan apr result to inform your calculation.

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Payday Loan True APR Calculator

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Frequently Asked Questions

What is the typical APR on a payday loan?

What are the alternatives to payday loans?

Why do people use payday loans despite the high cost?