Is Congress Caving In On Payday Loan Industry Demands?

There is a lot of buzz going around Twitter today about the payday loans industry and particularly a report about Congress allowing the short term loans industry to charge up to almost 400% industry.

This is because many had suspected that the federal government would step in and put a cap on the loans at around 36%, which is what they capped short term loans at for Military families just a few years ago. However, in a complete turn of events they ended up settling on a cap of about 391%, which is about 10 times higher that was thought.

However, many people get caught up in the numbers, but is the loan really 391%. Well for example, a short term loan of $100, typically has a fee of about $15, and that is paid back within usually a week or two. Based on the terms, the interest is quite high, but there is only one payment, and one fee, so it’s not like it continues or revolves like most traditional loans.

Question: Is Congress caving to the payday loans industry demands, or are they looking out for Americans that needs money and by capping these loans at an unprofitable margin would wind up drying up one of the last places people can turn to get financing?