Between Google’s recent announcement that it would no longer accept advertising from payday lenders and the Consumer Financial Protection Bureau’s effort to crack down on that product set, payday lenders are in an uncomfortable spotlight. But you may not have heard about efforts to make saving as much fun as playing the lottery.

What’s sometimes lost in the conversation over the evils of payday lending is the fact that people use these products for a reason: payday lenders promise fast cash, and the borrowers who take out these loans often have no savings and poor credit. When you have no emergency fund and no credit card, and your clutch gives out, what else are you going to do?

“If you’re extremely low income with poor credit history, you don’t have a lot of options,” said Michael Goodman, a professor of public policy and director of the Public Policy Center at UMass Dartmouth.

Moreover, he said, there aren’t a whole lot of incentives for financial institutions to do proper outreach into the low-income communities that payday lenders favor. Certainly, Massachusetts is home to plenty of community banks and credit unions that do their best, but those institutions also have to balance that against their various other obligations – to shareholders, to regulators and to their other customers.

“Financial education and financial literacy are sorely lacking, particularly in communities that are served by these sort of predatory payday lenders and other online equivalents,” Goodman said.

There’s been some talk that banks could get into the small-dollar personal loan space if the CFBP goes ahead with certain amendments it is considering to its rules governing payday loan-type products. According to American Banker, which first reported on this topic, lenders could be exempt from certain underwriting requirements if the loan term is between 46 days and six months and if the monthly payments do not exceed 5 percent of the borrower’s gross monthly income.

That’s encouraged at least a handful of banks to rethink the small-dollar personal loan.

But Pedro Arce, vice president at Eastern Bank, thinks that’s still missing the point.

“The way that we look at it is, it’s more an issue around savings and being prepared than it is finding a loan for somebody who needs money for an emergency. That’s more a reactive approach. I really think there should be more time and resources dedicated to helping people plan and understand why they need an emergency savings account,” he told Banker & Tradesman. “It’s great for financial institutions to be able to make small-dollar loans, but I think we also have to be practical.”

Toward that end, Arce points to the work of Doorways to Dreams, an Allston-based nonprofit that’s taken up the mission of encouraging saving amongst America’s financially insecure. The organization schemes up product ideas and prototypes and collaborates with other stakeholders, like financial institutions, state and federal policy makers and other nonprofits and grassroots organizations.

Executive Director Tim Flacke said the group has had success encouraging people to save using gamification and prize-linked savings. It’s not enough to tell people they should be saving, he said. Most people know that already. The trick is making it fun.

Or, as he puts it, “Savings is associated with denial and pain, and who wants more of that?”

A ‘Durable And Important Shift’

Flacke described an app the nonprofit built called SavingsQuest, which rewards users with little badges, status updates and other merits for saving even as little as a penny. He likens it to a Fitbit for savings.

As an example of using gamification to encourage saving, he describes another product he’s seen in the market, particularly among credit unions: For every $25 you save in a particular vehicle, you earn a chance to win a monthly, quarterly or annual prize. You might get up to 10 chances per month, rewarding people for saving and making it exciting for them at the same time.

But there’s a legislative patchwork nationwide where prize-linked savings products are concerned. That’s because private lotteries are prohibited in most states and because savings promotion raffles (the term of art that Flacke uses) are considered a type of lottery.

As part of its work, Doorways to Dreams advocates for legislative changes that would permit financial institutions to offer prize-linked savings accounts, and the organization has tallied victories in 17 states so far.

A bill pending in the Massachusetts legislature could make the Bay State number 18. The bill, titled “an Act to Promote Personal Savings,” would allow financial institutions to offer savings promotion raffles. The bill was introduced last spring and recently reported favorably out of the Joint Committee on Financial Services. Right now, it sits with the Senate Ways and Means Committee.

In the meantime, Flacke said the goal is not necessarily to get every individual in America to save up a full six months’ worth of living expenses; he just wants to get people started on the right track.

“This is about self-efficacy,” he said. “You want people to begin to believe in their own ability to do this. It won’t always be the right moment to save, but if they move from a place of feeling really helpless about their ability to save and get ahead to a point where they have some confidence, that’s a really durable and important shift.”