Activists Warning Consumers About New Bank Loan Product

BOSTON (CBS) - As most banks look for new sources of revenue, some are turning to a controversial new product: high-interest, ultra-short-term, payday loans.

But the banks call them something different.

Wells Fargo and US Bank have begun offering loans that customers draw against their paychecks.

But fees are sky high. For a $100, two-week loan, a customer would pay $16.

Edgar Dworsky of consumerworld.org tells WBZ these new products are sprouting as banks' profits are crimped.

Dworsky says most of these payday loans carry triple digit annual interest rates.

In:
• Anthony Silva