The Competition and Markets Authority will investigate potential ways to increase price competition in the payday loans sector.
This will include setting up a price comparison website and creating clearer upfront disclosure of borrowing costs if a loan is not paid back in full and on time.
More top news
Theresa May says it "can't be right" for Big Ben to be silenced for four years during renovation work.
A 20-year-old model accused the wife of Zimbabwe's president of attacking her.
The former US president quoted Nelson Mandela in a series of tweets written in response to white supremacist groups in Charlottesville.