Missouri payday loans shops charge an APR averaging 444 percent, according to the Missouri Division of Finance, assuming two-week loans. The Center for Responsible Lending says banks charge a 365 percent APR, saying that the loans last an average of only 10 days until paychecks arrive.

While the interest rates being charges are less than regular payday loan providers, they are still quite expensive compared to a conventional loan. Other banks require you to deposit money into a savings account while paying off your loan. I’m not sure how people who needed a payday loan in the first place are supposed to pay foo their loan and put more money in a savings account at the same time.

 St. Louis Community Credit Union, for instance, gives small dollar loans for 90 days at an APR of 25 percent, plus an annual fee of $25, which covers all loans during the year. On a typical $450 loan for three months, the interest would be $28. Ten percent of each loan goes to a savings account. The idea, said CEO Patrick Adams, is that the savings account will grow as the customer keeps borrowing until they no longer need a loan.