But a February 2011 National People’s Action report found that the industry disproportionately affects low-income and minority communities. In black and Latino neighborhoods, payday lenders are three times as concentrated compared to other neighborhoods, with an average of two payday lenders within one mile, and six within two miles.
In 2007, a report by Policy Matters Ohio and the Housing Research and Advocacy Center found that the number of payday lending shops in the state catapulted from 107 locations in 1996 to 1,562 locations in 2006, a more than fourteen-fold increase in a decade. Nationally, the industry doubled in size between 2000 and 2004.
Previously, one of the industry’s prime targets was the US military. It preyed on service members so aggressively that Congress outlawed payday loans for active-duty troops. That was in 2006, in the wake of a General Accounting Office report that revealed as many as 1 in 5 service members fell prey to the high-interest lenders that set up shop near military bases.
One of the report’s more stunning – but by no means unique examples – concerned an Alabama-based airman who initially took out $500 through a payday lender. Due to the lender's predatory practices, she ended up having to take out so many other loans to cover that initial small bill that her total financial obligations to pay off the loans rose to $15,000.