And yet again we see the DUmmies demonizing a process that they clearly don't understand.
Point the first, every lender with a grain of common sense is going to charge higher interest rates to borrowers without proven credit history, or with poor credit history. Quite simply, those are the borrowers who are the most unlikely to pay off the amount as agreed, so the lender charges more for the risk, and to compensate for those who don't repay the money. As DUmmies WeDidIt pointed out, the terms are clearly laid out when you get the loan. I've never gotten one, but I suspect that the terms are something along the lines of x% interest rate, with interest calculated every two weeks (to match the typical pay schedule). That would add up very quickly of course if the loan is not paid off in a timely manner, but I imagine that the high interest rates are meant as deterrent to ensure that people do pay off the loans as planned.
And the regarding the DUmmy who was bemoaning the fact that Payday Loan centers are mainly in black neighborhoods, from what I've seen, they are largely in lower income areas, which makes sense because in all honestly, most people with a higher income have other resources. A person who makes $8000 a month is unlikely to need an extra $200 to make it to the next paycheck, and they probably have at least one credit card, or some savings, or some other resource to turn too.
In the DUmmies world, banks should be forced to offer low interest rates even to high risk people (wait, they already forced the issue there. That's how we got into this mortgage mess in the first place!)