Payday loans are big business

Many average Americans live from paycheck to paycheck. Any sudden emergency, medical, transportation related or otherwise, can easily expose them to enormous financial stress. Even a person with a bank account and some average or less than stellar credit may find it impossible under those circumstances to come up with enough cash to check the emergency.

Payday loans are a commonly used method to manage a financial emergency. Houston payday loans stores are only a few among the hundreds of thousands of payday loan stores in the United States. As a matter of fact, the greater Houston metropolitan area alone has more than 3,000 payday loan businesses.

Traditionally payday loan stores make payday loans. Yet, check cashing places and pawn shops are also granting payday loans to worthy customers. Even some Rent-to-Own retailers give payday loans. Consumers can also find payday loans on the Internet or over toll-free phone numbers.

It does not come as a surprise that the payday loan industry is very big and profitable business. Estimates put the loan volume of the industry at around 4.7 billion dollars. Payday loans over the Internet added another 10.8 billion to the total volume in 2010. Internet lenders collected 2.7 billion in fees in the same year.

Storefront payday loans and Internet loans together accounted for 40.3.billion dollars. The two collected 7.4 billion dollars in revenue – astounding for an industry that is often accused of taking unfair advantage of economically weak Americans in need of financial help.

In response to this criticism many states instituted more or less strict control over payday loan companies. A total of 18 states and the District of Columbia limit in one form or another either the maximum interest that can be charged for payday loans or limit the size of the loan to a percentage of the gross income of the borrower. Texas is one of them. Houston payday loans are privy to such protection.