Two sides to the boom in pawn shop banking lead to same place

One side is outlined in Todd Zywicki's August 2013 article for The Volokh Conspiracy, Pawn Shops Boom as Consumer Retail Banking Retreats.  From this side the boom is part of a larger wave of decentralized banking. The wave got a big push from U.S. federal regulatory overkill in the wake of the 2008 financial crash. The largely unintended consequence were to push many Americans, even those in the higher-income brackets, out of the traditional banking system when they found that obtaining credit through the banking system had become virtually impossible.
 
The other side of story was laid out by Lydia DePillis in a December 2013 article for the Washington Post titled Your Neighborhood Pawn Shop is Propped Up By Big Banks. It starts:

We usually think of payday lenders, pawn shops, rent-to-own stores and other high-cost loan operations as alternative forms of financing for people who are short of cash. But that's merely a facade: They couldn't operate without billions of dollars in cheap capital from the nation's biggest banks.

So it seems all the differently painted doors lead to the same place. The "retail" American credit shopper is getting hit with high fees no matter where he turns.

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