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The other side agrees that the law has been at least a semi-flop but points to a different villain: greed. Lenders want to be able reap the profits that come from effective annual interest rates of 300% to 700%, says Lynda DeLaforgue, co-director of Citizen Action Illinois. So they mostly have stopped making loans under the payday law, which covers loans of up to 120 days in term, in favor of slightly longer-term loans, which are regulated under a different (and much looser) law.

Greg Hinz of Crain's Chicago Business investigates a state house plan to close loopholes in the payday law.

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