Demand for payday loans has more than doubled from 170,000 in 2007 to 350,000 loans in 2011 -- the highest ever reported to the Minnesota Department of Commerce, MinnPost reports. In 2011 alone, Minnesotans borrowed $130 million in such short-term loans and on average paid equivalent annualized interest rates of nearly 240 percent. Some rates were as high as 1,368 percent.
“We are supplying a service that the consumer can’t get somewhere else,” Stuart Tapper, vice president of UnBank Co., which operates UnLoan Corp., the third largest payday lender in the state, told the online publication.
Small businesses are also facing big loan hurdles. For many small entrepreneurs getting a loan is no easier today than in the depths of the financial downturn five years ago. The Star Tribune reports higher loan standards -- together with rising health care costs and a possible minimum wage hike -- are keeping the squeeze on Minnesota’s small businesses.