Fifth Third Bank offering payday loans

Fifth Third Bank is now offering payday loans. They call it “Early Access Checking”. I think this is great. More competition means the customer wins.

Here’s how their product works: You must have a job and direct deposit. The term of the loan is 35 days and the rate is 120% or $10 per $100 borrowed. The full advance is automatically debited from your account.

Now, they can offer the product at this price point b/c they have total control over the customers bank account. Non-depository payday lenders do not have that luxury, so of course, their loan losses are going to be higher.

You can read the full article in bizjournals here.