Payday Loan Benefits

Studies show that consumers prefer PDA products over bank products in five ways:

1. Access to immediate cash
2. More accessible locations
3. Better service – more tellers, better product mix
4. More respectful and courteous staff
5. Trustworthiness – product pricing more clear cut

As banks continue to reduce branch offices and increase fees for small balance accounts the strength of these preferences can only increase. This does not prevent the banks from embracing the product and along with credit unions, offering PDA products in new and creative forms. For example: a line of credit with $500 maximum and APR of 11.75%.

Contrary to general opinion, clients who use the ‘loan between payday’ services are not drawn from the lowest of income levels, but from a more financially stable group than the clients who use ‘check cashing’ services.

An industry study conducted in Canada indicated that 58% of 'loans before payday' clients are male, with a median age of 32.4 years; 82% earned $40,000 or less; 20% are classified as professional; 18% are skilled tradesmen; and from 12% down to 4% in the categories of labourer, business, retail clerks and hospitality industry employees.

Another study analyzed users of check cashing services. It was revealed that these users are generally younger and drawn from lower income groups, with 80% reporting annual incomes under $30,000, and 75% under the age of 35.

PAYDAY LOANS can be used by:

• Retailers
• Wholesalers
• Internet Traders & Auction Sites
• Shopping Carts
• Call Centres
• IVR Payments
• Utilities
• Local Government
• Telesales
• Door-to-Door Sales
• Mail Order Systems
• Software and Information Vendors
• Service Providers

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