About 1 in 3 Christians who live in the 27 states that place few restrictions on short-term, high-interest “payday” loans have used them, according to a recent survey by an evangelical research organization.
Lifeway Research reported that the 34% figure reported in its 2023 survey is twice the percentage of Christians who reported doing so seven years ago.
About 45% of evangelicals said they personally know someone who has received a payday loan, nearly a third more than the 32% who said so in the 2016 poll.
Additionally, the research group found 77% of Christians in low-restriction states say it’s “a sin” to make loans that harm a borrower financially.
Such harm could come to borrowers via high-interest rates: South Dakota and Nevada, for example, have no limit on the annual percentage rate for short-term loans, which are supposed to last 14 days but are often renewed again and again.
“The proliferation of retail payday lending establishments has increased the first-hand knowledge many Christians have of these financial institutions,” Lifeway Research executive director Scott McConnell said in a statement. “The majority of Christians in states with few regulations on payday lending want more regulations that protect borrowers.”
The survey found that most Christians are unaware of the percentage of payday loans that end up being “rolled over” into a new loan, with additional fees. A 2014 Consumer Financial Protection Bureau report gave the renewal rate as 82%, but only 9% of Christians surveyed estimated such rollover rates as being 81% to 100%. The majority of those surveyed (56%) put the renewal figure at 40% or lower.
According to the Lifeway survey, Christians in states without extensive regulation of the industry want the government to intervene. Almost two-thirds of respondents (63%) said the maximum APR for such loans should be 36% or less; nearly 4 in 10 said the top rate should be no more than 12%.
Survey respondents also believe local churches should get involved with those facing financial issues that often trigger payday-loan borrowing. More than a third of those surveyed (36%) said churches should provide gifts or loans for those facing financial emergencies.
Some churches have made such efforts. In 2018, the Rev. Frederick Douglass Haynes III, pastor of Friendship-West Baptist Church in Dallas, Texas, told Religion News Service that his church operates the Faith Cooperative Federal Credit Union, which offers “small-dollar loans” as an alternative to the payday loan shops near his church.
Mr. Haynes did not respond to requests for comment.
Lifeway said it conducted its research among those identifying as Christians in the 27 states where such loans are largely unrestricted: Alabama, Alaska, California, Florida, Hawaii, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New Mexico, Ohio, Oklahoma, Rhode Island, South Carolina, Tennessee, Texas, Utah, Wisconsin and Wyoming.
The polling took place Feb. 22-27, and was sponsored by Faith For Just Lending, which describes itself as a “coalition of faith-based institutions working to end predatory payday lending.” The researchers said 1,000 online surveys were completed, with a margin of error of plus or minus 3.3 percentage points.
• Mark A. Kellner can be reached at mkellner@washingtontimes.com.
Please read our comment policy before commenting.