For critics of payday lenders, a bill in the Legislature that would result in bigger loans and higher fees is a gift to a predatory industry.
At a glance, they might be right. Floridians, mostly in poor neighborhoods, took out a staggering 7.7 million payday loans over 12 months in 2016 and 2017. And nearly a third of all customers took out at least 12 loans that year, a clear sign of the "debt trap" that lenders profit from, critics say.
But the bill is sailing through the Legislature with bipartisan support.
In short, the bill is an effort to help a powerful industry that could – or could not – see major changes in the coming years.
Payday lenders fear that a new federal rule will nearly eliminate their main product: the simple, small, single-payment loan. In Florida, pay a lender $50, and they'll give you a $500 loan. Within 30 days, the lender takes the $550 out of your bank account. All you need is a pay stub to show you have steady work.
But the Consumer Financial Protection Bureau proposed a rule last year that could restrict loans to people who have already taken out six loans in a year. Considering how many people are repeat borrowers, the Bureau estimates the rule could eliminate up to 62 percent of current payday loans.
"It might as well be 100 percent," said Ian MacKechnie, the founder and CEO of Tampa-based payday lender Amscot. "Nobody's going to be around. It puts us out of business."
To get around the rule, lenders want to offer a second product: a loan of up to $1,000, payable in installments within 60 to 90 days. That requires a statewide change, though. Florida caps such loans at $500.
The new bill would also result in higher fees for customers. Instead of paying the maximum $50 twice for two $500 loans, the new fees would increase to $216 for a single $1,000 loan.
State Sen. Rob Bradley, R-Fleming Island, one of the bill's co-sponsors, called it a "very important bill this session."
"Our fellow Floridians rely on this product," Bradley said. "And there's 10,000 people who work in this industry whose jobs would be threatened if we do not address the actions of the federal government."
He's supported by the Democratic minority leader in the Senate, co-sponsor Oscar Braynon, D-Miami, who compared payday loan stores to hospitals – you don't want to use them until you have to.
"Some people don't have a choice," he said.
But the changes might not come to pass. The new head of the CFPB said said the Bureau is now "reconsidering" implementing the rule, which would take effect in August 2019.
The industry is not counting on that, though.
"As an industry, we're assuming this is a bill that will take effect," MacKechnie said. "All we're doing is asking our legislature to amend our statute to allow us to continue to offer credit in a way that will continue to stay in business."
Despite the reputation of payday loans, economists have been surprisingly mixed about whether they're good or bad. They provide an essential service in poor communities that are underserved by banks, which don't offer short-term credit.
But federal officials have considered them predatory, destructive products for some people. In 2006, Congress passed a law capping interest rates for loans made to active-duty military at 36 percent annually, after a Pentagon study found service members' stress from payday loans was harming "military readiness."
That 36 percent annual percentage rate effectively eliminates payday loans, which, if spread out over a year, would have annual rates greater than 200 percent under the new bill.
Whether they're simply good or bad is the wrong question, according to Mehrsa Baradaran, the associate dean for Strategic Initiatives at the University of Georgia School of Law and the author of the book, How the Other Half Banks.
"Is it bad to take out one of these loans? I think the answer is yes," she said. "If you can get this money from any other source, it's best to avoid them."
But she said that some people are stuck with no other option.
"It might be the rational choice. It might be the only choice," she said. "But it doesn't put you in a better position."
The concern is not that borrowers won't pay their loans. Fewer than 2 percent of customers default, according to data from Florida's Office of Financial Regulation. Florida allows for a 60-day grace period without incurring additional fees and free credit counseling for people who can't pay their loans on time, and state law does not allow people to take out multiple loans at the same time.
Rather, the concern is that customers fall into a trap, where they find they have to routinely rely on loans – and paying the fees – to get by.
"I am a faith leader who has seen up close and personal the damage that these types of loans cause," the Rev. Rachel Gunter Shapard told legislators last week. "We believe that this relies on exploiting our neighbors when they're vulnerable."
State data shows that heavy payday loan users are the industry's cash cow. The 28 percent of people who receive at least 12 loans per year make up 56 percent of all payday loan transactions.
MacKechnie said that if the CFPB does not implement its rule, and Florida's bill passes, the new $1,000 loans could make up roughly 30 percent of the company's loans.
Alice Vickers, director of the Florida Alliance for Consumer Protection, told Legislators they should not take the chance.
"We're going backwards here," she said. "We are creating a product that will cost the borrower even more than what is in law today."