The number of offices such as this in south Toledo has risen nearly tenfold in Lucas County in the last 10 years.
A new report says so-called "payday loan" offices are more common than fast-food restaurants in Ohio.
In Lucas County alone, their numbers have shot up nearly tenfold to 67 over the past decade, catapulting the county to fifth behind Franklin, Cuyahoga, Hamilton, and Montgomery counties, according to Policy Matters Ohio and the Housing Research & Advocacy Center.
"This is a very bad sign," said David Rothstein, of Policy Matters. The spread of the offices, which charge up to 391 percent annual interest for small, short-term loans against a future paycheck, is an outgrowth of Ohio's economic struggles of recent years.
An industry spokesman defended payday lending practices.
Customers typically pay $15 on each $100 borrowed for two weeks, said Lyndsey Medsker, of the Community Financial Services Association of America.
Although that may seem high, it is cheaper than penalties imposed by banks when a customer bounces a check, she said.
And that is the choice often faced by customers: take out a payday loan or write a check knowing that the account doesn't have enough money to cover it.
"Customers look at their options and payday lending makes sense to them," Ms. Medsker said.
Outside a Cashland Financial Services office in south Toledo yesterday, a steady stream of customers declined to comment and a manager ordered a reporter and photographer to leave.
Although industry advocates say payday loans are primarily for temporary dire straits, research shows that the average customer borrows from them up to nine times a year, said Mr. Rothstein, of Policy Matters, a nonprofit research group.
"There are a lot of people who are working poor who use these almost like a bank account."
The spokesman for the industry group, which represents 60 percent of the nation's 25,000 payday lending offices, said members have launched an education campaign to urge customers to use their services only in emergencies.
Also, they have liberalized policies for people who unable to repay the loans at the end of the two weeks.
One of the report's key findings is that the centers, which in 1996 were found primarily in cities, have spread to small towns and rural areas.
"They're everywhere," the Policy Matters researcher said. Only two Ohio counties - Ottawa in northwest Ohio and Vinton in southeast Ohio - had no payday lending offices as of last year, the report found.
Although the establishments remain concentrated in large cities, less populated counties have a greater number per capita. In Williams County, the eight offices represented 2.04 payday lenders for every 10,000 people. The northwest Ohio county ranked 11th per capita.
Statewide, the number of payday lending offices rose nearly 15-fold between 1996 and 2006 to 1,562. That is more than the combined total of restaurants operated by the McDonalds, Burger King, and Wendy's chains in Ohio, Policy Matters said.
In a typical payday shop, loans for up to $800 are made for 14 days.
They are called payday loans because that is the interval between paychecks at most employers.
At the end of the two weeks, borrowers either repay the loan or the lender cashes a post-dated personal check written by the borrower when the loan is made.
Contact Gary T. Pakulski at: