As regulators crack down on storefront and Internet payday lenders, a new report says four big banks -- including Wells Fargo and U.S. Bank -- are major players in the multibillion-dollar fast-cash industry, charging vulnerable people interest rates as high as 365 percent.

In many cases, the four banks charge even higher fees and interest rates for their emergency loans than payday lenders, according to a brief report released Monday by Minnesotans for a Fair Economy. The group names Wells Fargo Bank, Fifth Third Bank, Regions Bank and Minneapolis-based U.S. Bank.

The St. Paul-based organization claims that Wells Fargo and U.S. Bank are hiding behind their charters to avoid the sort of regulation other payday lenders face. Formed last year, the group is made up of community groups, faith groups and labor groups such as the Service Employees International Union.

"The banks are getting away with something that had drawn legal action on the payday lenders you see on the street," said Kevin Whelan, spokesman for Minnesotans for a Fair Economy. "We hope the leadership at each institution will reconsider these business practices."

Wells Fargo and U.S. Bank representatives say they don't engage in payday lending. They call the services "checking account advances" or "direct deposit advances" and offer a list of features that make them different from payday loans. The advances, for example, are only available to people who have checking accounts with the banks and make regular direct deposits into them.

San Francisco-based Wells Fargo said another key difference is that, unlike with payday lenders, it doesn't roll over or extend the advances. Instead, the amount is automatically repaid with the customer's next direct deposit, whenever that is.

Neither bank actually calculates an annual percentage rate (APR) on interest for the loans, saying they charge straightforward fees.

"It's not appropriate to calculate an APR on a flat fee that must be repaid with the next direct deposit," said U.S. Bank spokesman Tom Joyce.

U.S. Bank introduced its "checking account advance" in 2006, he said, adding that a 2012 customer survey indicated 96 percent of the customers using it were "satisfied" or "extremely satisfied" with it, Joyce said.

According to the Minnesotans for a Fair Economy report, a $500 advance repaid in the typical 10-day term costs $50 at U.S. Bank, which would be an APR of 365 percent. Over at rival Wells Fargo, which has provided such advances since 1994, the fee for the same loan is $37.50, which amounts to an APR of 274 percent.

"It is an expensive form of credit and it's not intended to solve long-term financial needs," said Wells Fargo spokeswoman Richele Messick.

By one industry estimate, payday lending is a nearly $40 billion-a-year industry in the United States. Payday lenders have been criticized for setting loan terms that keep cash-strapped borrowers in perpetual debt. Nearly one-quarter of all bank advance payday borrowers receive Social Security, according to the Durham, N.C.-based Center for Responsible Lending. Many states, including Minnesota, have been cracking down on storefront and click-for-cash Internet operators.

Banks, with their state and federal regulators and federal guarantees on customer deposits, are supposed to be different.

Critics say they aren't. Bank advances are payday loans in disguise, they argue, with their short terms, extra high costs and the lenders' direct access to borrowers' accounts.

Banks have become more aggressive in marketing such products, said Uriah King, vice president of state policy at the Center for Responsible Lending. Because Wells Fargo and U.S. Bank are federally chartered, they say they're not subject to state laws, he said.

"I think that's one of the real troubling [developments] in the last couple of years," King said.

The new U.S. consumer watchdog, the Consumer Financial Protection Bureau, has targeted illegal practices among payday lenders as a priority. Its investigation includes the emergency deposit advance products banks offer.

Minnesota Attorney General Lori Swanson has sued eight non-bank Internet payday lenders in recent years for charging strapped Minnesotans unlawfully high annual interest rates of up to 782 percent. The state Department of Commerce has taken on a number of out-of state Internet payday lending companies, too.

Minnesota law caps the fees that can be charged on payday loans. For loans up to $50, for instance, the cap is $5.50; for loans between $350 and $1,000, the limit is 33 percent annual interest plus a $25 administrative fee.

David Wagner, a 36-year-old Minneapolis man with cystic fibrosis, said he used regular payday lenders for years. Last year, he said, he went to U.S. Bank seeking to open a checking account with overdraft protection and a bank employee steered him to the direct deposit advance program. Only later did he realize how expensive it was, he said. He's still using it because he hopes to establish an ongoing relationship with a bank.

"I don't have a choice," said Wagner, explaining that he cannot make ends meet with his Social Security check and his part-time work as a home health aide.

"The payday loans I get have helped with medication and food for the house, but it doesn't help me get caught up completely," Wagner said. "We almost never get ahead."

Jennifer Bjorhus • 612-673-4683