Visualization of payday loans

Hi all.

As in the last post about rent to own, this post will explain payday loans without the jargon.

Say you have a deal with a friend lending him $100 for 2 weeks, if he pays you 15 dollars now (a fee). If he continues this for a whole year, he will have borrowed $2,600,  but he would have paid you 390 dollars in total in the fee.

If you got paid 15 dollars each 2 weeks for 100 years, you would get $39,000.  That is a lot of extra money.

Over the life of the loan, each day your friend would only pay you $20 for the $100 you lent him, but he would pay $30 in extra money.