We owe a lot to the brave men and women who choose to serve in our country's armed forces. And now I'm hoping that one recent measure passed specifically to assist military personnel will serve as a template for all consumers.

The 2007 defense authorization bill includes a provision capping annual interest rates on consumer credit loans — including on so-called "payday loans" — to service members and their dependents at 36 percent.

What's a payday loan? They are small, short-term, high-interest-rate loans, typically of a few hundred dollars. They go by a variety of other names: cash advance loans, check advance loans, post-dated check loans or deferred deposit check loans.

Under a payday loan, borrowers promise to repay the debt out of their next paycheck, usually in two weeks. They typically write a post-dated personal check payable to the lender for the amount borrowed, plus the fee, or authorize the lender to withdraw the funds electronically. If borrowers cannot repay on time, they are allowed to roll over the loan, of course for additional fees.

Fees charged for payday loans are usually a percentage of the face value of the loan, starting at about $15 for every $100 loaned. On an annualized basis, the fee charged on these loans can top out at 400 percent to 1,000 percent, according to Travis Plunkett, legislative director for the Consumer Federation of America.

The payday loan industry has been accused of targeting the military and causing many members of the armed forces to fall into a downward spiral of debt. The industry rejects that claim, arguing that military personnel account for only 1.3 percent of revenue across the industry.

However, a study released by the Defense Department found that military personnel are three times as likely to use payday loans as civilians. Such loans can be particularly problematic and career-ending for military personnel because a poor financial record can result in the loss of security clearance or even a court-martial.

To get a payday loan, you have to have a bank account. You have to give the lender permission to cash a post-dated check or electronically take the funds out of your account. That means you are giving a creditor direct control over your cash. That is never a good thing.

"It's just wrong to charge 400 percent, no matter how severe the need is," Plunkett said. "These loans are inherently abusive, whether they are directed at members of the military or the general public."

Plunkett said what's good about this legislation is that interest is defined to include all extra charges and fees of any kind, including the sale of related products such as credit insurance.

The measure prohibits lenders from basing loans to service members on checks written without adequate funds in the bank. It also would bar lenders from arranging loans that give them electronic access on a priority basis to a service member's bank account or paycheck. Finally, the provision would ban loans secured by a service member's vehicle. That type of loan is called a title loan.

The payday lending industry characterizes the small short-term loans it offers as a financial taxi to help people get from one paycheck to another when faced with an unexpected cash need.

Payday loans are cheaper than bouncing a check or paying a late fee on a credit card, says Darrin Andersen, who is president of QC Holdings, a payday lender, and president of the Community Financial Services Association of America, which represents more than half of the estimated 22,000 payday advance industry outlets.

Most payday customers use the service about six or seven times a year, Andersen said. He added that his company and others are filling a need.

It may be that payday loans are in demand, but you can't base the demand for this type of business on the satisfaction of cash-strapped, desperate individuals.

Helping the military steer clear of predatory, high-priced debt is a good thing. It would be even better if the legislation was expanded to include all consumers.