The real cost of a $300 payday loan, week by week
At $15 per $100, a two-week payday loan looks cheap. Follow one $300 loan through eight fee cycles to see how $45 fees add up to $360 while the balance never shrinks.
The short version
At a glance
Key takeaways
- A CFPB review found a typical payday loan carries a median fee of $15 per $100 borrowed for two weeks. That equals about 391% APR.1
- On a $300 loan, each two-week cycle costs $45. After eight cycles, about 16 weeks, you have paid $360 in fees and still owe the full $300.
- Nearly half of payday borrowers have more than 10 transactions a year, and 14% have 20 or more.1
- A federal credit union PAL, capped at 28% APR, would cost about $25 in interest to borrow $300 for six months.2
The math
How a $15 fee becomes 391% APR
Payday fees look small because they are quoted per $100 for two weeks. APR shows the cost over a full year, which makes loans comparable.1
$15 ÷ $100 = 15% per two weeks
15% × (365 ÷ 14 days) = 391% APR
15% × (365 ÷ 14 days) = 391% APR
For comparison, the same formula turns a 1% weekly fee into 52% APR. Any short-term fee can look small until you annualize it.
Week by week
Follow one $300 loan through eight fee cycles
When you cannot repay the full $345 on payday, many lenders let you pay just the $45 fee and roll the loan over for another two weeks. The balance does not go down.
| Due | Fee | Total fees | Still owed |
|---|---|---|---|
| Week 2 | $45 | $45 | $300 |
| Week 4 | $45 | $90 | $300 |
| Week 6 | $45 | $135 | $300 |
| Week 8 | $45 | $180 | $300 |
| Week 10 | $45 | $225 | $300 |
| Week 12 | $45 | $270 | $300 |
| Week 14 | $45 | $315 | $300 |
| Week 16 | $45 | $360 | $300 |
The pattern
Why the loan rarely ends after two weeks
Repaying $345 in one lump sum two weeks after you needed $300 is hard. The CFPB found that most borrowers who take out a new payday loan do so on the same day the old one is closed, or soon after.1
That is why repeat use is common. Nearly half of payday borrowers have more than 10 transactions a year, and 14% have 20 or more.1
Better options
What the same $300 costs elsewhere
Interest on $300 repaid in equal monthly payments over six months, using published average rates and legal caps.
Interest cost to borrow $300
Payday: eight two-week fee cycles (about 16 weeks). Others: six monthly payments.
Payday loan at $15 per $100$360
Credit union PAL at 28% APR$25
Credit card at 22.36% APR$20
Bank personal loan at 11.90% APR$11
i
Active-duty service members are protected by the Military Lending Act, which caps most consumer loans at a 36% military APR.4
Your state
Check your state’s rules
45 states and DC cap the APR on a $500, six-month installment loan, according to the National Consumer Law Center.5 Rules for payday loans vary widely, so check your state regulator before you borrow. Read our guide to state rate caps.
If you need help with a bill rather than a loan, dial 211 for free, confidential referrals.6 Our payday loan alternatives guide ranks other options by cost.
FAQ
Common questions
How is payday loan APR calculated?
Divide the fee by the amount borrowed, then multiply by the number of loan periods in a year. A $15 fee per $100 for 14 days is 15% × 365 ÷ 14, or about 391% APR.
What is a payday loan rollover?
A rollover lets you pay only the fee on the due date and extend the loan for another pay period. You pay a new fee each time, and the amount you borrowed does not go down.
What is the cheapest alternative to a payday loan?
For many borrowers, a payday alternative loan (PAL) from a federal credit union is the cheapest small loan, because its APR is capped at 28%. Free help such as payment plans or 211 referrals costs nothing.
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Sources
Sources for this page
Official and primary sources only. Last reviewed October 17, 2026.
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1
Consumer Reports AdvocacyCFPB findingsSummary of CFPB payday loan research
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2
America's Credit UnionsNCUA rulesComparing PALs I and PALs II Loans
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3
Federal Reserve BoardOfficial statisticsConsumer Credit G.19
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4
Consumer Financial Protection BureauFederal lawWhat is covered under the Military Lending Act?
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5
National Consumer Law CenterState law researchState APR Caps for $500, $2,000 and $10,000 Installment Loans
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6
United Way 211Nonprofit helpline211 helpline: free, confidential referrals 24/7