Our Work

Consumer Protection

Predatory Lending

Predatory loan products such as car title or payday loans offer small-dollar loans to those looking to make ends meet. However, they come at a very high cost. In Mississippi, fees on these loans can equal an interest rate that tops 500 percent.

Mississippi has the highest concentration of payday lenders per capita in the nation, with about 1000 locations mostly concentrated in low-income areas or in communities of color. They offer quick money without a credit check. Borrowers often cannot pay the full amount of the loan back when comes due, leading them to take out a second loan with additional fees, creating a cycle of dept that is hard to break. Nearly 60 percent of payday loans in Mississippi are taken out by women—most are single heads of households looking to make ends meet for them and their children. These loans become another monthly bill for families whose budgets are already vulnerable.

While Mississippi Center for Justice understands the need for small-dollar loans, we oppose a business model that institutes these high interest rates in the nation’s poorest state. The Center is seeking solutions that break the cycle of debt for hardworking Mississippians who become entangled in when borrowing from these lenders.

As the lead organization in Mississippians for Fair Lending—a coalition of more than 40 businesses, financial institutions, faith-based organizations and nonprofits—the Center is working to change policy in Mississippi so that a 36 percent rate cap applies to these loans.

The Center is also working with large employers across the state to educate them about the direct impact predatory lending has on their workers, and to help them establish financial literacy classes and alternative loans for their workforce. We are also working with a number of banks and credit unions to help them develop and implement low-dollar loan products that are affordable for people who most need them.

Mississippians just like A. Washington, who was threatened with arrest for one of her outstanding loans, is just one reason the Center is waging war against predatory lending.