The study, released this week by the Pew Charitable Trusts, found their rates are so high mainly because they're among only seven states that impose no legal limits on them.
Idaho payday lenders charge an average 582% annual interest on their loans to lead the nation, The Salt Lake Tribune reported.
That's followed by South Dakota and Wisconsin, both 574%; Nevada, 521%; Delaware, 517%; and Utah, 474%.
Among states with storefront payday lenders, the lowest average interest charged is Colorado at 129%, which matches its legal limit. The next lowest are Oregon at 156% and Maine at 217%.
Fifteen states either ban payday loans or cap interest rates at 36%. None of them has any storefront lenders.
Without a limit on interest rates, competition among lenders does not tend to lower rates much, according to the research.
Representatives of the Alexandria, Va.,-based Community Financial Services Association of America did not immediately respond to requests for comment Sunday.
The study also found the nation's four largest payday loan companies charge similar rates to each other within any given state, usually at the maximum allowed by law. States with higher limits have more stores, but the rates remain higher and competition does not lower them much.
"This new research shows that payday loan markets are not competitive," Nick Bourke, project director for Pew, told The Tribune.
The study urges states to limit payments to "an affordable percentage of a borrower's periodic income," saying monthly payments above 5% of gross monthly income are unaffordable.
On average, a payday loan takes 36% of a person's pre-tax paycheck, Bourke said.
"Customers simply cannot afford to pay that back and still afford their other financial obligations," he said. "This is why you see people ending up borrowing the loans over a! nd over again."
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