In recent years, there have been growing concerns about the ability of lower-income people toaccumulate financial assets. Because of the strong economy, new welfare regulations, andcontinuing immigration, an increasing number of lower-income people are entering theworkforce and receiving paychecks regularly. However, lower-income people remain at adisadvantage for building wealth. High-cost credit is one obstacle to asset development forlower-income people, and the payday loan is one example of high-cost credit. This report provides a new analysis of the payday lending industry and its customers. Usingdata obtained from the Illinois Department of Financial Institutions (DFI) and various othersources, it finds major faults in the key defenses that the industry has used against strongerconsumer regulation.