Hoping to avert the dangers of predatory lending and improve its workers' financial fitness, Virginia is giving its employees access to small, emergency loans. The Virginia State Employee Loan Program offers non-probationary state employees short-term loans of up to $500 with no credit checks and no late fees. Borrowers must belong to the Virginia Credit Union and have at least $5 in a savings or checking account. To qualify for a loan, participants must complete an online financial course and a 10-question financial literacy exam. At an annual interest rate of 24.99 percent, employees who take $100 would pay back about $108, or $540 on a $500 loan - substantially less than the average 365 percent annual interest rates charged by payday and car title lenders last year. The loans, administered through the credit union and backed by the nonprofit Commonwealth of Virginia Campaign, are repaid through direct debit from an employee's credit union account. Employees can only have one loan at a time and two per year. The loan program has issued $641,657 in emergency loans to 1,310 employees since it was launched in mid-July. Officials hope other local governments and private employers will follow suit with similar programs.