$15 per $100 for 14 days = 391% APR.
APR (Annual Percentage Rate) standardizes the cost of borrowing so you can compare products. A typical payday loan at $15 per $100 for a 14-day term has an APR of approximately 391%. Some states allow fees resulting in APRs over 600%.
How payday loan APR is calculated
APR = (Fee / Amount) x (365 / Term) x 100
For a $15 fee on $100 over 14 days: (15/100) x (365/14) x 100 = 391%. The short loan term is what makes the APR so high compared to monthly or yearly products.
200% to 700%+ depending on state
States with $10/$100 caps: ~260% APR. States allowing $30/$100: ~780% APR. The national average is around 400% APR.
Credit cards: 15%–30% APR
Even the most expensive credit cards charge 30% APR. A payday loan at 391% APR is 13x more expensive on an annualized basis.
Most loans are not repaid in 14 days
CFPB data shows 80% of payday loans are rolled over or renewed. The effective cost over actual borrowing periods is much higher than a single-period fee suggests.
APR calculations are illustrative. Actual APR depends on fee amount, loan term, and state regulations. Federal Truth in Lending Act (TILA) requires lenders to disclose APR before you sign.