There's a mistake on the quest text. During every other part of the dialogue, the price he's asking is 250 gold.
It's correct. The 250 gold = 100 gold she borrowed + the 150 gold fee that the other creep is charging (aka interest)..
I think the 175gold reward is outof the total 250gold (to the other poster). You're basically either paying the difference or whooping the creep's ass.
What really surprised me was the part of the dialog where the creep says he can settle it in other ways (considering its a little girl involved) lol.. maybe its an ode to Fallout 2 where you could pimp your wife or something...