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The rates charged by payday loan/rent-a-center places can be far higher than rates charged by mobsters in most instances. A 2% /week loan comes out to ~104% APR. Most payday loan places are dealing with APR's of at least 300% APR. Some charge rates as high as 1000% or more. They would superficially be more attractive because theoretically you don't have to worry about someone threatening to break your legs or put your daughter on the street. Payday loans and credit cards are also dealing in volumes that most loan sharks couldn't dream of.
As far as larger amounts for loans I think the subprime lending, hard money lenders and general home equity loans filled that market. In the glory days of loan sharks, people weren't borrowing against their homes as much as they've done in the past 10-20 years. The market for credit has expanded exponentially in the past 2-3 decades.
This is something I am very interested in. I'm not saying mob or independent loan sharks don't exist, still thrive and fill a market. I would just like to be able to determine what impact the credit expansion has had on them. There's got to be a rigorous study/comparison out there somewhere.
First, the weekly rate by a loanshark is going to depend no any number of things. Who he's lending to, for what, how much, how long, etc. It might be 2% a week. It might be 5% a week. The lower the amount loaned, the higher the vig.
Second, the loanshark doesn't just lend to anyone. They have to know them. It's often a different clientele that is going to a loanshark and one that is going to the local payday loan outlet. Often it's people who are already involved through gambling.
Third, as for "larger amounts," the mob doesn't make millions from the racket by only lending nickels and dimes.
