In reply to Gavin.

What is "predatory" about Payday lenders? No one has a gun to the consumer's head and make them sign for a payday loan. If the lender does not clearly explain the terms, that would be cause for action but if the citizen enters into the arrangement with full understanding of the costs, I see no problem with a lender getting all of the return on their investment that they can.

Loans are a competitive area. If a consumer can qualify for a good rate, there are many outlets for them to take their business. If a consumer has no or poor credit, the lender takes on much more risk servicing that loan and needs to be compensated for that risk.
"Clamping down" on these lenders by implementing interest caps only results in this option going away as it is no longer worth the risk for the return. People pushing these policies are actually saying that they would rather have someone that is a poor credit risk have NO option than a bad option.

The only alternative is to force traditional lenders to issue loans to people with bad credit at an artificially reduced rate (that does not reflect the true risk of that loan) which will force rates up for everyone else. I should not have to subsidize someone else's poor decisions through higher than "deserved" costs to me in order to grant a benefit to someone that did not earn it (artificially lower interest rates on loans to them).