Should Google really be selling advertising to these sites? Payday loan operations really are the scum at the bottom of the barrel.
There is a dark iceberg under the consumer Internet. Online pharmacies. Rebill scams. "Government grant" applications. High interest loans. Educational institutions of dubious utility (disclaimer: took one's shilling once, indirectly, and regret it a bit). Spam, scams, and the like, on a massive scale.
There is a UI for AdSense publishers where some Google PM made the decision "If we give them options to tart up their website less, let's tell them how much money it costs."
http://bits.blogs.nytimes.com/2011/08/24/google-reaches-500-...
No one will touch them without charging exorbitant fees. We either stop it and let people suffer, or we allow it to continue and people at least have some ability to continue living a somewhat decent quality of life and not homeless on the streets.
For instance in NL we have the 'Gemeentelijke kredietbank' (https://www.degkb.nl/diensten/kredietverlening in dutch), a bank that operates without profit motive for those in situations as you described above.
Another option is that it's made illegal, and there are no good alternatives, so "unofficial" sources for loans are found. These can range from family members to Mafias.
Unfortunately many governments are off flogging austerity to the public while underwriting the banks and keeping interest rates near zero. So the banks can't be bothered lending and the lender of last resort becomes the payday loans companies. Meanwhile traditional banking is busy investing in the payday loans rather than directly lending itself as bank loans follow interest rates.
The USA is actually doing comparatively well in all this as it never took the austerity thing to heart as much as the Eurozone, where Germany is currently worrying about a triple-dip.
edit - as far as I can tell, the reason that the interest rates have been kept so low, at least for here in the UK, is because the house price bubble must be defended at all costs.
There is a large portion of the UK economy that will scream blue-murder if they stop getting massive year on year returns on simple ownership of housing and the Bank of England doesn't like pissing them off, which is going to be Mike Carney's job when he finally raises interest rates, shortly before jumping ship as the official scapegoat of the UK house price crash.
Obviously this is a massive guess, but it looks somewhat likely.
However our banks thrived, they profited by offering loans to major banks down in the US.
House prices are on the up and up. Me and my wife bought just before they tightened up mortgage regulations here, since then house prices in our area have been going up by about 13% per year as banks were no longer issuing mortgages for Toronto house prices ($500k and up) as the down payment required doubled and they increased the threshold on the default insurance (you need about 15% down to get the same rate you used to at 5% down).
However, the banks were being so risk averse in the recession I couldn't even get approved for a $500 credit card. I'm from the UK, so with no credit history I was an untouchable. A couple years earlier my wife with essentially negative income as a student had been handed cards left, right and centre.