There are renewed concerns that payday lenders will keep customers trapped in a cycle of debt following the roll back of a federal rule.
The research group Policy Matters Ohio says even with tougher laws in states such as Ohio, families still can still be exploited by the industry.
The Consumer Financial Protection Bureau has eliminated a pending rule requiring lenders to verify that borrowers would have no difficulty paying back high-interest loans.
The rule surfaced during the Obama administration, but was formally scrapped last week under President Donald Trump.
Kalitha Williams, project director at Policy Matters Ohio, says widely known research on the harmful effect of these loans still holds true.
"The research has shown that the interest rates for payday lending are so high that most people cannot reasonably pay them back," she states.
Williams says borrowers often resort to taking out more expensive loans to pay off the original debt.
Ohio, once known for having widespread and permissive payday lending, recently enacted reforms.
However, Williams and other researchers say businesses still are finding ways to charge high rates and fees.
The industry says implementing the federal rule would have restricted access to credit for consumers.
Williams says getting rid of the rule comes at the worst possible time, with many families struggling financially during the COVID-19 crisis. She says that's especially the case with extra federal unemployment benefits due to expire at the end of July.
"If people had to turn to this type of lending, there would have been regulations in place so they wouldn't be completely exploited," she stresses.
And Williams says with longstanding racial gaps receiving more focus in recent weeks, there is additional concern that communities of color will continue to be targeted by these lenders.
Those advocating for more protections say there should be a national lending cap of 36%, so that borrowers no longer have to grapple with triple-digit interest rates in various parts of the U.S.