Allred said potential borrowers are told twice the interest rate that they will pay, even when it’s 521 percent.

Payday lenders are extremely clear about what taking out a loan will cost.  They have to be, in many states what they tell borrowers is regulated and must be extremely clear.  For CFSA member companies, according to CFSA’s Best Practices lenders need to show borrowers in writing and on big posters in their stores exactly what the terms are.  Matter of fact, studies CFSA has conducted tells us that consumers choose payday loans because it is very clear.

To recap:

Lenders are up front about the terms of the loan.

Borrowers understand what the loan will cost them.

Borrowers still choose to take out the loan.

Anti-payday lending groups are confused, demand that payday loans be banned because borrowers don’t understand the terms of the loan.