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This post contains some case studies on how General Small Business Loans helps run small business.

Case Study 1

Ron runs a small shop at the west end of San Francisco. May was an exceptionally busy month for him. He was able to sell off most of his wares quick and easy. He had a standing order for more goods as well. Wonderful! Everything seemed nice till now. But there was a problem. Most of his customers buy on credit.

He knows they will pay up, but the cash would come only after 2 weeks. In the meantime, he had to invest money to buy new wares so that he could keep selling and honoring those standing orders. Ron just couldn’t afford to keep his store empty.

So what does he do?

Ron goes for a small business loan to see his business through till the money from prior sales begins to come in. He doesn’t have to spend a lot of time seeking the funds, as the cash advance is credited to his bank account in just 24 hours. That is perfect for him, as he can keep focusing on his business.

Case Study 2

Richard Dyson knows that business and personal expenses should be kept separate. But it was rarely the case with him, like so many other small businesses across the US. The money he made at the end of the day often went towards paying the bills, buying medicines, college fees of his son, and that occasional splurge. He just couldn’t keep them separate, no matter how hard he tried.

Disaster struck suddenly! His wife had to be hospitalized one morning. Most of his savings went to paying the hospital bills. To make matters worse, it was the end of the month as well, so he had to pay the salary of his two employees. That couldn’t wait, as they required the money too. If these two guys go, Richard wouldn’t have anybody else to run the business, as he was himself busy with his wife’s illness.

But all was not lost. Dyson took a small business loan, paid the salary, and everything went on smoothly. Crisis averted!

Small Business Loan Companies to the Rescue

It is quite well known that many individuals, particularly those who are denied credit by the conventional lenders and banks, go to small business loan companies whenever they are in urgent need of a cash advance. This happens throughout the United States and elsewhere in the world too. Ironically, these lenders are attacked even after all the good work they are doing.

But it’s not just the individuals who gain from these loan companies. You might be surprised to know that even small businesses can benefit immensely from these loan companies. Case in point – the two case studies given above.

The fact is that, not much has been said about how small dollar loans are helping small businesses solve their temporary cash crunch situations.

Sure enough, Wal-Mart Stores, McDonald’s, The Home Depot, Ford Motor, Boeing, Citigroup, Verizon Communications, AT&T, General Electric, Hewlett-Packard, Wells Fargo and the other large businesses generate a lot of revenue and employ thousands of people across the country.

The US Economy Depends On Small and Mid-Sized Businesses

But the US economy would surely take a deep nosedive if small and mid-sized businesses shattered. These enterprises are present in virtually every street of America. Their presence is undeniable. Collectively, they employ many more people than the big boys. They are the backbone of the American economy, and the great American dream. The big boys can outsource, have their factories in China, Korea and Malaysia, and send away the employments there. But the small and mid-sized enterprises are deep-rooted to the American culture. They employ only locals, and keep the local economy running.

These are the businesses that often need emergency cash, as they are low on reserves. And many of them are turning to small business loans for sustenance and even survival. Sometimes, the money is required to make a small investment, sometimes for urgent repairs, and sometimes it could be as simple as buying fresh stock or paying salaries.

Why a Bank Is Not the Solution Often?

Often the requirement is urgent. Approaching a bank isn’t the solution as it can take up to two weeks to get the money. Sometimes it takes even more time. So the very purpose is lost. There are simply too many delays and hassles.

You need to fill out the form first. The bank will then make inquiries, see your profit-loss account and balance sheet before deciding. There could be the issue of collateral too. You might have to visit the bank a number of times, which means time away from the business. Many small business people cannot afford this as they are always hands-on.

And anyway, banks usually are not too keen about loans of small amounts. They never give these loans the importance they deserve. The big boys bother about big amounts.

Small Business Loans – Just the Opposite of This

Small business loans are all about convenience. These businesses can apply for a loan online. There is no collateral or mortgage, not even any credit check. You can ask for as little as you want, even as little as $500. The term is short, so there is no long-term debt to worry about. And the money is deposited directly to the bank account in just 24-48 hours.

No wonder, thousands of small businesses across the country are going for these loans now. Rarely has there been an extensive survey of the impact of these loans on the performance of small and mid-sized businesses. But if such a study was performed, then it would have proved how important small dollar loans are for the American economy.

Make It Easy To Get Loans

Credit rationing for small businesses is the worst news for the US economy. The regulators should do just the opposite. In a capitalist society, you need to make it easy for business to get money. Make the enterprises liquid so that they have the money to prosper, roll the money back, and hire more people.

This will solve unemployment, stop the outward flow of employment, and make the US economy grow from the inside. More employment means more purchasing power. So if the small and mid-sized businesses are able to grow, then the bigger players are going to eventually gain too.

Small business loan companies are doing a good work. By imposing severe restrictions, the market regulators could end up severely cutting the growth of many businesses. Allow these lenders to keep offering money to small and mid-sized businesses. The promoters, employees, and suppliers all depend on them. In fact, the entire neighborhood could suffer if they shut off. Let these innovative engines grow the American economy.

Apply Today for any type of loan requirement. If our lenders feel you deserve a loan, they will give you no matter what.

Some companies around the world offer payday loans to their employees. It is particularly meant for those employees who feel financially strapped. This follows complaints that many of their workers often face problems in paying off their bills every month, particularly during the last few days of the month.

These companies state that they remain committed to helping their “valuable associates” in whatever way they could. The facility is available only to the low-income employees of the company. They can thus get the money when they need it at competitive rates to buy food, gasoline, and pay for child care, rent and urgent medical bills.

If you are looking for a payday loan we might help. We have partnered with the best and registered lenders in US. Result is that you get the better rate possible loan available today. Its fast, processed in a few hours and its fully automated.

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Payday Lending to the Rescue

This is yet another example of how a payday loan scheme is coming to the rescue of workers, who often don’t have the money to pay for their urgent requirements at the end of the month. Sadly, there are millions of such people in the United States now. Often, banks and other conventional lenders won’t give them the money they need because of their low pay or less than perfect job record. This is the reason some companies have come forward to their rescue within the company, but there are other payday lenders who are helping such individuals outside this retail chain - like us 🙂 . Their impact is far-reaching as these businesses are able to reach out to millions of more people.

These Scheme Are Profitable Too

Companies say that it wants to protect their employees and provide them the finances, but the scheme is likely to be profitable for the company as well. Fact is there is a ready base of more than a million customers who can take these short-term loans. According to their own estimates, some companies could make more than $10 billion every year by loaning cash to their own employees. That’s of course not a small amount of money.

Some employees are however against this scheme as they feel that it will make them indebted to their own employers. They are saying that nobody is forcing the employees to take the short-term loan. It’s just an option given to those who need the cash at the end of the month.

Perhaps the better option for those who don’t want to take the cash from their own employers is to find independent payday companies. Here is where we can help.

A lot has been said in recent times about the so-called predatory practices of payday lending companies. However, what has often been ignored is the positive impact of payday lending on many communities in America. For instance, studies carried out in recent times have revealed that consumers have actually fared worse since some states took the extreme step of banning paycheck advances.

The Pitfalls of Preventing Payday Lending

What happens when you deny short term loans to those who need the money at the end of the month? Most of them don’t have anywhere to turn to. They turn to illegal sources of funding and end up paying an even higher interest rate. For example loan sharks. And of course, a high percentage of people who take these loans end up with long-term debt. Many of them have to declare bankruptcy too, as there is no other option.

That’s not all. Studies have also revealed that after financial disasters, people who can get a payday loan report a competitive rate of substance abuse treatment and going into depression, than the communities where such loans are not available.

But even with all this data coming through, you will still find some policymakers and legislators who are reacting aggressively to payday lending. What they should rather do is address the root causes of long-term debt and endemic poverty in America. Thankfully, some of these policy and decision makers are realizing the truth now, and so, the fight against passing excessive payday lending regulations has begun. Some of these legislators have already stated that they don’t want more regulations to be implemented against payday lending.

Are There Any Payday Lending Alternatives?

Those against payday lending often point out that there are better financial alternatives than these short-term loans. With this belief, they advice people not to approach these small cash loan companies.

However, if such alternatives are available so readily, as pointed out by these critics, then why are millions of Americans approaching payday lenders for cash advances even now to pay off their unexpected bills and for their emergency fund requirements? It simply doesn’t add up. Clearly, the problem is not payday lending. It is somewhere else.

Is the CFPB Research Poor?

It has sometimes been said that the Consumer Federal Protection Bureau or the CFPB is conclusion rich, but research poor. For instance, the Obama administration wants to bring in new regulations for the short-term credit business, however the bureau is not up to date with their research to find out how these loans are affecting the financial welfare of borrowers. Obviously, the agency cannot know the reality. CFPB claims that they are data-driven. But they need to have essential information to know what helps consumers and what doesn’t.

Fact Contradicts What Many Critics Are Saying

The fact is that, many so-called experts and critics are far removed from what the reality actually is. Last summer, for instance, the Consumer Federal Protection Bureau released their own analysis of complaints received from consumers directly. This analysis revealed that of all the complaints received, less than 1% was from people who took payday loans. Most of the complaints they got were related to credit cards, debt collection and mortgage issues. Together, they made up a staggering 2/3rd.

There have been other such studies too that have arrived at much the same conclusion. So, clearly, the problem is not payday loans. It is elsewhere.

That said some companies have done the right thing by offering a way out to their employees. It is time more companies come forward to help individuals in real needs. Also, it is time we understand and learn to appreciate the valuable work the payday lenders are doing for people who cannot get cash for emergencies from any other source.

If more restrictions are imposed the poor will suffer if the payday lenders close their shop.

Small dollar and payday lending companies are offering valuable service to the nation by giving away loans to individuals and small businesses. Many of their clients are people who cannot get cash from conventional banks and lenders because they don’t have collateral or have poor credit score. The money is transferred within 24-48 hours of approval. This is a great help too in an emergency.

However in spite of this, these lending companies have been under attack in recent times. A section of the media has come out with negative stories on these businesses. Many people have expressed concerns on the operations of these companies. As a result, legislation has been passed restricting the operations of payday lenders. There is increasing supervision on their operations.

But things are beginning to change as realization begins to seep in that these businesses indeed offers an extremely valuable service. Kendrick Meek, a former Democratic congressman from Miami, recently wrote to the Consumer Financial Protection Bureau (CFPB) saying that the US should pass new legislation as the restrictions in place currently are simply too heavy-handed. He further stated that the current laws are depriving people of important lending options in an emergency.

Meek even pointed out that many of these businesses could shut-shop soon because of these threats.

Others are beginning to speak out against imposing severe restrictions on payday lending as well.

Andrew F. Quinlan, who is the President and co-founder of the Center for Freedom and Prosperity, now says that the poor people in the United States are going to suffer if the small dollar lending businesses are attacked any further. Quinlan stated this recently while writing for InsideSources.com. The Center for Freedom and Prosperity is a think-tank from Washington that promotes free market ideas and ideals.

Many Americans Are Facing Economic Hardship

A lot of Americans are living from one paycheck to the next one these days. Many of them are of course simply overspending and have too little savings. However there are others who are simply not making enough money to survive. And these are the people whose life will turn to the worse if the proposed rules of the Consumer Financial Protection Bureau that target payday lenders and implemented.

According to estimates of The Brookings Institution, roughly 1/3rd of the US households are living “hand-to-mouth”. That is a staggering 38 million people. Their lives are going to be negatively affected if there are restrictions on payday loans, as many of these people often have to take these loans to see them through till the next pay day. A severe cash crunch could even push them to crime, thus causing a law and order problem.

Those Requiring Payday Loans Often Do Not Have an Alternative

There are a lot of individuals in the United States now who rely on payday loans for paying off unexpected bills and to meet other cash emergencies. These people usually don’t have any other finance alternative.

While most others for instance would use their credit cards to pay for unexpected expenses, these people are forced to take a small loan that lets them stay afloat till the next paycheck arrives. That’s because, given their financial status, limited income and credit history, most banks and conventional lenders deem them too risky.

Of course there are some individuals who are doing well economically but would still take a payday cash advance because most of their money is tied up in long-term savings plans. The small cash loan plans are perfect for them, as they can get the money they need very fast (24-48 hours), which is great for emergencies. These are short-term loans, and so these people can get out of debt quickly too.

But those are rarities. In most cases, people asking for these loans are from the economically backward section of the society. They need this money in emergencies later in the month, and are denied credit by conventional banks and lenders. Payday loans are usually the only credit option for them.

Protection from the CFPB

Ironically, the Consumer Financial Protection Bureau wants to protect these borrowers by ensuring that they don’t go too deep in debt. However, in trying to do this, the CFPB might end up restricting the only credit line they can get. This is could be disaster.

How are these people going to pay their bills at the end of the month, repair the car so that they can go to work, or going to find the money to visit the doctor? It could be a matter of life-and-death for them. Can the Bureau deny them this?

In fact, the Consumer Financial Protection Bureau has also acknowledged this, saying that between 60% and 80% of the payday loan market could get wiped out if further restrictions are imposed. Those who need the money most could then turn to the loan sharks and end up paying even more.

Well loan sharks are illegal unlicensed or not-registered bushiness or lenders. They offer loans at very high rates since they are taking too much of a risk by lending illegally. These people then resort to threat or even violence if money is not paid back.

Is Pay Day Lending Wrong?

Yes, it is a fact that the payday lending agencies charge more than conventional lending companies. But that is because those who want these loans are high-risk customers. Many of these customers default frequently as well. The higher interest and fees are charged to cover for this higher risk. It also allows the payday lenders to stay liquid so that others who need the money can get it quickly in real emergencies.

The higher interest and fees does not usually hurt consumers who pay back the loan in time. They don’t end up paying too much more as it’s just a short-term loan. Also, the higher interest charged has been over-hyped. For instance, the credit card industry keeps charging a high fee and interest. But there is hardly any resistance to this.

Moreover since the loan is small – someone taking a hundred dollar loan may end up paying just 20 or 25 dollars more once they get their pay. That’s a small sum to pay back. Its very affordable too.

What Can Happen If There Are More Restrictions on Small Dollar Lending

Arbitrary caps would be bad, because they won’t allow the lenders to cover their business costs and risks. This is why Dodd-Frank, creator of the agency, is prohibiting a usury cap. However, the CFPB has little congressional oversight and unusual autonomy.

The rules that have been proposed also impose unnecessary burdens that are going to drive the cost of servicing low-income customers. If this happens, then the payday companies have to either charge more or deny money to many customers. Besides, they will have to check credit history and verify income, thus making it more difficult to get the loan. The money cannot be disbursed so quickly as well.

Living from one paycheck to another is not fun. Nobody likes this. But this is a reality for millions of Americans. A payday loan provides them respite. Don’t deny this to people who need the money the most.

If you need a loan please apply here.

If you drive through Ellis Avenue, slightly off the interstate, you will arrive at what can be said to be the paradise for easy money. You will find here plenty of half-empty shopping malls, fast-food joints, and payday loan companies by the dozens.

Mississippi is the poorest state in the USA. There is more payday lending companies here per capita than any other place in America. Interestingly, people also have less in this part of the country to conventional banks than any other US state.

The government and regulators know this. And so, they have formed a unique partnership so that people can get the money they need in a crisis. It’s a partnership between payday lending companies, employers and the Mississippi Center for Justice. With this unique partnership, the Mississippi residents can now access responsible payday loans. They can also get financial education absolutely free to learn about new ways of building credit and savings.

The New Roots Credit Partnership

This program is called the “New Roots Credit Partnership“.

The program pairs lending companies who want to provide small loans and financial literacy with employers who want to offer the knowledge to their employees. The New Roots Credit Partnership was launched in 2013. Two years later, it’s growing steadily. There are more subscribers today than ever before.

The initiative has already published a number of partnership videos where the consumers are explaining how the loans have helped them. The Mississippi Center for Justice is involved in this initiative, and also the employers. So there is nothing to worry about. It is not just legal, these cash loans are safe too.

“It’s a great partnership”, says Charles Lee, who is the consumer protection director at the Mississippi Center for Justice. Consumers get the money they require, and also financial literacy. Lenders get new customers. Employers benefit too as they are able to bring down the garnishment numbers they must process every month. They can also give their employees important benefits. It works out for everybody.

Under this program, half of the loan amount goes to a free bank account. The other half is kept on hold. This is released only when the first portion is paid back. Borrowers get more time to pay back the loan. The cash advance can be as low as $500.

How the New Roots Credit Partnership is Helping

Employees – The benefits are both long-term and short-term. In the short-term, the employees get the loan they need. And long-term benefits include the financial education and free savings account. Many residents in this corner of Mississippi never had a checking account, and very little financial knowledge on how to handle money responsibly and how to save. Prior to the program, for a lot of people, taking care of important bills meant paying up cash or taking a money order.

But that is changing now, thanks to this loan and education initiative.

Lending agencies – It’s good for the lenders too, as they are able to connect with a previously untapped potential customer base. True, income from these accounts does not generate much income for them. The real benefit is long-term, and in the new relationships they are building.

The lenders are able to participate in the well-being of people. They are helping individuals turn things around. So in time, as the fortunes change, these associations are going to turn into relationships as people realize that the lenders can become the key to their changing fortunes.

Employers – This credit partnership is helping employers address several issues that are affecting their bottom lines. Many employees in Mississippi had no option but to approach employers for advances on next week’s pay check. Many employers were receiving garnishments that had to be processed from different parties. This was a payroll nightmare.

Also, employees under financial stress invariably became distracted at work as they had to deal with their financial emergencies. This naturally brought down productivity.

The New Roots Credit Partnership is addressing all these issues successfully. It’s no surprise that the program has been welcomed so well in the communities where it has been introduced.

Microcredit Is Transforming Poor Communities

Across the world, microcredit is transforming poor communities, just like it is doing in the US state of Mississippi. And those who are benefiting are not just the individuals. Small dollar or payday loans are helping businesses too. With this, entrepreneurs are able to get the crucial start-up funding they need, which is sometimes as low as few hundred dollars.

Sometimes, this is all that a small business requires for generating income in a poor community. The state of Mississippi is not the only example. For instance, there is the Grameen Bank in Bangladesh that has been offering small loans for a long time now. In fact, the Grameen Bank even won the Nobel Prize for their efforts at fighting poverty in 2006. The New Roots Credit Partnership in Mississippi is a step in this direction.

This unique initiative has for now signed up the cities of Canton and Jackson. One regional housing authority and a school district in the Delta have also joined the program. But they have plans to take it further and reach more communities soon.

Many Individuals Require Quick Cash Loans

It is believed that those who require payday loans are usually poor individuals. But Mississippi’s experience is telling a different story.

According to Charles Lee, many people who receive payment once every month, such as firefighters and teachers, discover that there is a gap, particularly at the end of the month when the money from last month is gone or almost gone. This is where they require a bridge loan till the next paycheck.

Credit alternative such as the New Roots Credit Partnership is currently the only hope for many of these people in places like Canton and Jackson. In fact, this is the only financial service many of the “unbanked” individuals in Mississippi or those without a bank account have ever used.

The program is helping in another way. There are thousands of individuals in the state who are “under-banked”, which means that these people have bank accounts, but still rely on the grey market for cash advances, which are not only illegal, but charge steep fees as well, thus making people go deep in debt. The FDIC says that according to statistics, 47% of Mississippi residents are under-banked or unbanked.

Providing Legal Lending and Bringing People into the Mainstream

The New Roots Credit Partnership is bringing these people into the regularized financial sector and protecting them by providing financial education and loans from legal sources.

People in the state are vulnerable already in several fronts. In Mississippi, there are many low income households. Many are not that familiar with banking. Also, almost half of those who need cash advances are single women. Garnishments set in when you lose control over a loan. Suddenly, there is no money for utilities. With debt spiraling, there are few alternatives to bankruptcy.

So the New Roots Credit payday loan program isn’t just giving them loans on good terms, it is going way beyond that in Mississippi.

We too practice good lending practices. For example our lenders are all licensed and never charge exuberant rates. On top of that roll-overs are allowed with a very low fee. And we totally appreciate programs such as New Roots Credit. We support anything that help consumers.

The CFPB or Consumer Financial Protection Bureau has imposed several restrictions on the operations of payday loan companies. Yes, we want the industry to be monitored closely – this will weed out the illegal loan lenders. However, many people are of the opinion that these restrictions are too severe. In fact, it has even been pointed out that much of the payday loan operations could be put under immense pressure because of these limitations.

Kendrick Meek, a former Democratic congressman from Miami, now says that the United States must pass new legislation as the restrictions in place currently are simply too heavy-handed. The US can learn from the Sunshine State’s payday loan regulations and its experiences over the years.

Meek feels that the current laws are depriving people of important lending options in an emergency. Incidentally, the US state of Florida has one of the toughest laws to protect consumers from predatory lenders. But it does not deprive the payday loan companies.

While speaking to The Washington Times, Kendrick recently stated that he believes small dollar loans or payday lending is essential to those who do not have credit or good credit. He says that it’s important that we allow these people the money they need.

He further states that the law for payday lending in Florida provides access to loans without being too harsh for the industry, and it also protects consumers. This is just the perfect balance, because we want the consumers to be protected, but also want them to get the money they need quickly from a legal source in an emergency.

Payday loan regulation cannot be too heavy-handed, Meek says. So, any federal law that preempts this Florida law will be a huge mistake. He feels that a law that is working in one state, protecting consumers and safeguarding the interest of the industry, needs to be considered to be implemented nationally.

Florida Writes to the CFPB

But it now seems that the Consumer Financial Protection Bureau isn’t listening.

A few months back, the Florida delegation in the U.S. House of Representatives sent a letter to Richard Cordray, Director of the CFPB, urging the Bureau to implement the Florida payday regulation model across the United States. In response, Cordray said that he would take a look at the Florida model. He was however non-committal about using this state model across the country.

It seems that the agency has fallen a bit behind since the regulations first came into effect a few years back. For instance, no studies have been carried out by the CFPB yet to find out what’s working and what’s not in the states since the laws were enacted in the states. This is not correct. We feel whenever a law has been implemented, it should be closely monitored. Studies should be done to know whether the law actually benefited the consumer, if yes fine, if no it should be changed. It is time that such a study is carried out so that modifications to the existing laws can be made to make it more balanced for all parties.

You Cannot Choke Off Legal Credit Avenues

Kendrick Meek is a worried man. He feels that excessively stringent payday lending laws might choke off legal credit avenues for people who need the cash. We agree too. In states where payday lending is illegal, it is a known fact that consumers turn to loan sharks for cash. This is counterproductive to banning payday lending where at least, the loans comes at a cost that can be managed. Illegal loans are offered at exuberant rates, taking the consumer into a permanent debt cycle.

Meek is not alone in this. There are many others who are of the same opinion.

According to the findings of a Federal Reserve survey, many Americans who make less than $40,000 a year, often have to sell off their assets to pay for emergency expenses that are as little as $400. Payday lending is an attractive choice for them. With this money, they can keep their assets while they meet their financial obligations. So you cannot deny them this option.

Individuals should be allowed to get loans of $500 or less so that they can carry out their financial responsibilities legally. Kendrick worries that many of them will go for illegal loans if they cannot get the money from legal sources. This will only lead to more corruption and crime. That is certainly not a good situation. The state should take steps to prevent this.

The Law in Florida

The Sunshine State prohibits any rollovers. Consumers cannot take another loan to repay the original one. Borrowers are limited to just one loan of $500 at a time. Payday loan companies are not allowed to charge fees more than 10% of the original loan. The total term ranges between 7 and 31 days. If a borrower cannot repay the loan, then the person can get a grace period of 60 days, provided he or she agrees to credit counseling that helps create a logical repayment schedule.

Payday loan business has too many defaulters, i.e. people who take loans and never return. That is the reason why the rates on payday loans are slightly higher – to make up with the loss. Fact is that 10% on a loan for 30 days is not very attractive. You will therefore find a few lenders in Florida, but not as many as you would find in states where payday lending is legal.

The Approach of Good Payday Companies

Good payday loan companies don’t want their consumers to fall into a debt trap. They want to make investments, and want to make it easy for their consumers to pay it back so that the money can be back in circulation to help others. If people aren’t able to pay back because of steep interest and fees, then the loan companies are going to suffer as well. It doesn’t help anybody.

We therefore are not against regulators. We in fact need them to help us kick out the loan sharks or illegal loans entering the marketplace. So there should certainly be regulations and monitoring in place. The authorities should weed out bad operators that are ruining the reputation of the business.

Florida Regulations Working Well

The balanced payday loan approach in the state is working well. Lead author of the state legislation, Senator Lee Constantine, says that the rate of default has come down from 40% to less than 5% since the new laws were made effective.

So this approach is clearly working, and the CFPB should thus consider it for national implementation. However we have a problem with the 10% restriction. If that can be increased to 15% all lenders should be fine.

A 5-year study carried out in Florida reveals that a high percentage of consumers don’t have to seek a second loan now. The fees for one single loan in Florida of $395 comes to $39.50 or less. Nationwide however, individuals are charged $15 for a $100 loan. Thus for $400, it would come to about $60, which is higher than Florida. Plus, the fees are going to be charged for each roll-over as well. There aren’t any rollovers in the state however. This provides relief to consumers.

Lee Constantine says that the industry is regulated now in Florida. Most payday companies are responsible entities and are complying with the laws. We are too. 🙂

The Florida model could certainly work across the country. After all, this balanced approached has worked in the state for 14 long years. It’s time the Consumer Financial Protection Bureau took a closer look at it.

If you are a resident of Florida – please apply for your loan here.

Businesses that offer payday loans or cash loans, and the idea of these loans itself, have been receiving a bit of bad press in recent times.

Some people, and there are some financial experts too, are saying that these lenders are charging too much money towards interest and fees. It has been pointed out that many consumers are facing problems in paying off their debt in time because of the stiff conditions. So instead of financial relief, these people are going deeper into debt. It has thus been said that payday loans are not the solution to their financial troubles. We will discuss if this holds true.

Restrictions Imposed On Payday Lending Companies

Of course, the financial regulators had to do something about this. And so, eventually, restrictions on payday loans were imposed in many countries. In the United States, every single state has come out with their own laws to impose tight regulations and restrictions. It is clear that the authorities want to impose a tight leash on the lenders.

However, in spite of this, payday loans or cash advance loans remain extremely popular. It seems like, those who want cash in an emergency, want to depend on these companies. There has been no drop in the number of applications.

In fact, for many people, payday loans are the only way they can find relief from their short-term financial troubles. As a result, more lenders are beginning to offer these loans every day. There are more payday lenders in the world today than ever before.

Here’s What Happens When There Are Restrictions on Payday Lending

Payday loan companies are actually doing a great service to the society. Often this is not apparent till the time you bring in restrictions on their operations.

Take for instance what is happening in the United Kingdom these days.

The authorities and regulators have imposed several restrictions on payday lenders here. CFA or The Consumer Finance Association is reporting that there has been a 70% reduction in the total loan amount that is being approved every month, as compared to 2013, when the market was in peak.

So where are all these people going for the cash they need in an emergency? Conventional banks and lending agencies are often not the solution because they can take a long time in giving their approval. In an emergency, what you need is quick cash. Also, they would often reject applications. So clearly, they are not the solution.

People Are Turning to Loan Sharks and Falling Into a Debt Trap

According to findings of the first in-depth report on the short-term credit industry, many individuals who require fast loans are now turning to loan sharks in the UK. And these loan shark entities are charging hefty fees and interest rates, which are almost always much higher than what the payday loan companies charge.

But still, people are forced to approach these loan sharks, as these companies are offering the only way out to people facing a financial emergency. Also understand that loan sharks are illegal loan companies or individuals.

The problem seems to be growing too. In fact, it has been reported that more than 33% people reviewed, were considering approaching an illegal lender.

So clearly, the rigorous restrictions imposed on payday lenders are not working out for the people. They are becoming easy prey to the greed of loan sharks.

Here in the USA too there are loan sharks but since the lending industry is highly regulated the number of loan sharks is reducing considerably. Here is link to loan sharks in US: https://en.wikipedia.org/wiki/Loan_shark#Non-standard_lenders_in_the_United_States

In US, payday loan companies are legal business entities and their operations are closely monitored by the market regulators. These businesses follow all norms and regulations. Our lenders to are all licensed and qualified to do lending business in the US. We have lenders in all states where payday loan is legal.

Regulations Imposed On Payday Lenders and Their Effects

Recently, tight curbs were imposed on payday lenders in the United Kingdom. Penalty fees, interest rates and the overall cost was all brought under scrutiny. Financial Conduct Authority, which is the market regulator, made it mandatory for all lending agencies to get a license. Approved lenders were also made to pay annual levies.

The idea was to help customers get loans on better terms. As per the new regulations imposed, the cost for a loan of £100 for a month is just £24, if it is repaid on time. Previously, the cost used to be £30.

Of course this had a negative effect on the lenders. For instance, fortune of the Wonga lending agency nose-dived. Their pre-tax loss stood at £37.3m, as compared to a profit of £39.7m a year back, thanks to customer management fines and tougher regulator laws.

Why People Are Asking For Short-Term Loans

Families are managing finances differently these days. Economic recovery from the recession is still muted, and so, there is dearth of confidence among the consumers.

According to CFA’s Credit 2.0 report, household finances are under pressure because of increasing utility bills, climbing realty prices and increased travel expenditure. Rail fares have gone up as well by a staggering 23% in the last couple of decades.

Many people are wary of taking a long-term debt. Short-term alternatives are providing the financial lifeline to many individuals.

But what happens if companies that offer short-term debt are put under pressure? The result is out there for everybody to see.

If these companies are not able to offer loans for the short-term, then the consumers will go to those that can, such as the loan sharks. And most of them are not just illegal, but they leak their customers as well, through their steep interest rates and fees, thus making them go into a debt trap that is difficult to escape from.

Clearly, the imposition of strict regulations is not helping anybody.

What’s Happening in the United States?

In the US too, restrictions have been imposed on payday loan companies, though they are not as severe as the UK. Every state in the United States has its own regulations. Payday loan companies are happy to follow the set of laws. But of course, it is also important to safeguard the financial health of the industry.

Illegal lending is on the rise in the US as well. In fact, many people are already going to loan sharks for their short-term financial requirements here especially in states where payday lending is banned. That is surely a cause for worry. Why make people pay more needlessly? It is time the regulators cracked down on illegal lending, and appreciate the work done by legal short-term lenders link us. 🙂

Illegal lending is sure to go up if more restrictions are imposed on payday lending, just like what has happened in the UK.

Our advise is simple – do not take a loan that you cannot afford to pay. Read terms and conditions before taking a loan, if the payment terms are too strict or if the APR is just too high that you may not be able to afford, just reject the offer. No one can force you take a loan if you don’t want to take. Avoid going to loan sharks at any cost.

Understand that applying for a loan through us is free. Our lenders may reject or accept your application for loan. Now its on you to accept it or reject the loan offer after reading the terms. If you feel the repayments terms are too steep, just do not accept the loan. Its that simple. But the percent of people who reject our loan offer is next to nil because our rates are one of the low in the industry.

Try a loan with us. We bet you will like the offer.

Traditionally, like elsewhere in the country, most consumers in East Baltimore who required a small loan used to go to a community bank or credit union. Credit card programs soon took over. Credit card borrowing, as we all know, is very costly. As a result, many consumers ended up with a huge debt burden. In fact, the countrywide debt burden is estimated to be worth several billions of dollars now. And if you take into account all that stress and trauma of financial pressures because of debt problems, then it becomes an even more serious issue.

The Success of “Borrow and Save” in East Baltimore

“Borrow and Save” was started in East Baltimore a few years back to solve this riddle. Federal Deposit Insurance Corp. together with eight lenders in the area, and the Neighborhood Housing Services of Baltimore Inc., which is a nonprofit organization, launched this program. “Borrow and Save” was launched to allow residents in East Baltimore borrow funds at a lower cost.

The name “Borrow and Save” because the idea was people could take loan at competitive rates and save money that they would otherwise pay to the high rate lenders.

This pilot lending program was virtually an fast success. It gave people access to ready capital that they could borrow from, and like the name suggests, many of the borrowers were able to save money with the low fees and interest rates as well. Many people who took the loan were able to pay their car repair bills, for medical emergencies, and cover utility programs with this. Some even took the money to renovate their homes, add value to it, and for other reasons.

The Borrow and Save program started with a total of $90,000 available for lending. Each individual could take a loan of up to $1,000 only. The loan amount could be as low as $300. It was a pilot program to allow the lenders to gather information and learn about lending habits and consumer behaviors and preferences.

Soon enough, as it gained in popularity, more neighborhoods were added. The total funds available for lending grew too. All low to moderate income households throughout the city were allowed to borrow money from this.

Such Program Spreads Across the Country

Such was the popularity of “Borrow and Save” in Baltimore that soon enough, similar programs started to come up throughout the United States. Many such programs were introduced in rural areas as well in the US.

These small dollar loan programs turned out to be quite unique. Borrowers were given incentives to take money at friendlier terms and save as much as they could. The lenders wanted to promote the habit of saving money. They also wanted to make it easier for people to borrow funds when they required it in a real emergency.

Saving was a very important element. The lenders found out that a lot of people had very good budgeting sense, but many were living from one paycheck to the next. There was a high rate of defaults too. In fact, 20% loans were behind by 90 days or more. Neighborhood Housing Services came out with changes for lowering defaults. Financial literacy courses were also offered to the borrowers. They had to do a course before taking the loan.

As time passed and small dollar loans gained in popularity, it started to be called as payday loan as the consumers who took the loan returned them when they got their pay. At first people used to say “loan until payday” and then the shorter version “payday loans” became immensely popular and is still used very widely in US.

Payday Loans Are Much Like “Borrow And Save”

You will today find many payday lenders across the United States. These businesses work in much the same way as the “Borrow and Save” program of Baltimore.

Payday lenders usually offer loans between $100 and $1000 for a few weeks or till the next payday. But sometimes there can be an extension as well if you are unable to pay back the loan amount and the interest within the loan term. The interest burden is much cheaper than those charged by the credit card companies, and so the debt burden is easier to manage. Like Baltimore’s “Borrow and Save”, payday lenders are also helping people save money.

Payday lenders have made it easier for people to get these loans because they are processed quicker than what happens with conventional lending agencies and banks. In fact, you could submit your application online now and get it deposited to your bank account directly in just 24 to 48 hours. It rarely takes more time than that. There are almost no hassles too as very little paperwork is involved, and no standing in long queues. Your privacy is also guaranteed as you will usually apply for these loans from the Internet. You will never have to meet the loan officer if you don’t want to. Nobody has to know about your sudden financial situation.

Another great thing about these payday loans is that, there is no credit check. Which means that people with an average or even a poor credit score can apply for these loans or cash advances. Their applications would be approved. Actually the fact is that, these are the people who usually need financial help the most. But conventional lenders won’t give them the money they require.

Why Payday Loans Are Better Than “Borrow And Save”

Payday loans are in fact better than Baltimore’s “Borrow and Save” and such other programs you find today. Here’s how:

“Borrow and Save” and other programs like this always look at the credit report of an individual before deciding what to do with the application. This means that the money cannot be advanced so quickly (within 48 hours). These programs never make an advance to people who have past due accounts.

On the contrary, payday loan companies believe that there is no risk involved in lending money to those even with a past due. That’s because, these cash advances are just for a short period, typically for 2-3 weeks, and the loan amount is small as well. So the risk for the lender is very limited.

Payday loans have become so popular especially among the lower and average middle income households that almost every family takes at least 1 or more payday loan in their life. A few years back when the lending laws were not so strict people feared taking a payday loan. Its not the same anymore. There are many cases where lenders with bad practices were asked by the government to close their lending business. Popular payday companies like payday max etc have already closed their shops. Some lenders are also facing legal charges.

That is the reason we do not allow any non-licensed lender to join our network. If we get any complaint against any of the lenders in our network we stop doing business with them with immediate effect. We love what we do and we do it honestly.

Here’s requirements to get a loan from us:

1. You should be a citizen of the United States.
2. Should be 18 years of age minimum.
3. Should have a working bank account where the money can be deposited.
4. You must have a stable source of income.

If you have the above four you qualify to get a loan with us.

Click here to apply for a payday loan with us.

Payday loans or cash advances have received some bad press in recent times. These loans are also referred to as payday advance, payroll loan, salary loan, small dollar loan, short term loans, cash advance loan, post-dated check loans, quick cash loans, and deferred-deposit check loans. There have been people who have said that these lenders charge high fees. And yet, we have these companies everywhere these days. Thousands of individuals look up to these lenders to sort out their short-term cash crisis situation daily. The fact is that, there is always a huge demand for these loans.

If there is a demand, it means these loans are helping people solve their cash related problems. If it was unable to solve their problems, this business would have closed years back. Though the payday loan business growth has slowed down considerably in the US in the last couple of years.

Why are so many people asking for these loans, when they could have approached the banks and the other conventional lenders? There must be something really great about these loans, in spite of the bad press they have received.

Top 10 Benefits of Payday Loans:

That’s what we are going to find out in this article. Here are the top 10 reasons for getting a payday loan.

1. You can get the money you need quickly – What is your #1 priority when you face a financial emergency? It’s got to be a quick infusion of cash. But banks and other lenders cannot fulfill this need, as they need time to process applications. They have to carry out checks. More time is required for this. The delay can be killing. You could be in deeper trouble because of this delay. Payday loan companies are super-quick in comparison. You get the cash you need in less than 48 hours. This is precisely what you need in an emergency.

2. You can get just what you need – Sometimes, all you need is just a few hundred or thousand dollars, nothing more. Payday lenders will give you just this. Typically, these loans range between $500 and $1000. The amount you can borrow is limited by your income. The process and money with conventional lenders on the other hand is elaborate. Rarely can you get a loan of $500 from a bank. It’s not worth it for them to offer such small amounts.

3. Short-term – The risk is always limited because these loans are always for small amounts, and the term is only for a few weeks. So you don’t have to commit yourself to paying back a lot of money over months and years. You will thus know what you are getting into precisely. Compare this for a housing loan that can be for 20 or 30 years. A lot can happen in these years. There are too many uncertainties here, unlike payday loans, where you have to repay after just a couple of weeks, on receiving your next pay check.

4. Its Highly Convenience – Working with a payday lender is really convenient. These institutions are open beyond the banking hours. You can apply for the home online from your home all seven days in the week. However, if you want, you can apply in person as well. You don’t have to fill-out an elaborate form or answer questions, some of which can be quite personal. There is no hassle of standing in a queue. It is always private. Nobody has to know about your financial crunch.

5. No restrictions – The lending company isn’t going to ask you ever the reason why you want to borrow the money. So you could borrow for anything. On the other hand, banks and other conventional lenders are always going to make too many queries. Sometimes, it feels like you are asking for a favor.

6. Laws and interest rate caps – A section of the media has reported that payday loans are difficult because of the steep interest rate. It has also been said that many people face problems in repaying the money in time because of the high interest rate and fees. The reality is completely different. You should know that there are interest caps in place in every state. Also, there are limits on how much can be charged towards the processing fee. There are specific laws and regulations on payday lending in every state to protect the interest of consumers. Financial regulators are always looking closely at the operations of these businesses. So there is actually no risk for the consumers. And the cash you can borrow is limited anyway. You won’t enter a cycle of debt. There are also lending blocks, where you are restricted to just taking one single payday loan in a period. This too prevents you from getting into a debt cycle.

Note: All our lenders are state licensed adhere to strict guidelines of lending laws of their state. If they are not licensed we do not allow them to enter our network. Our main concern is you our customer.

7. There is no collateral – Conventional lender will give you money only when you can provide collateral, which they are going to seize if you are unable to repay for whatever reason. That is the norm across the world. There is however no collateral in payday loans. This further limits your risk. It is just perfect for those who don’t have any real asset that they can offer as collateral for a loan.

8. Cheaper than credit card debt – Payday loan is business after all, and so, there is going to be a fee. Plus, you will be charged interest for the money you have borrowed. However still, it’s cheaper than credit card debt, which has become a serious issue now as the total debt is valued at more than $900 billion. It has been estimated that the debt per person is more than $4000. It’s a fact that many people don’t have any credit left in their cards anymore. So they cannot borrow money. You can always get a payday loan if you cannot get a credit card advance.

9. No Credit checks – Banks and all other conventional lenders will always check your credit score before deciding whether to make the advance or not. However, there is no credit checking with payday loans. This is why, those even with an average or poor credit score can get these loans. Their applications are going to be approved. In fact, it is the only hope for people with an average or poor score. It is risk free for these lenders too, as the money advanced isn’t a lot, and the term is just for a few weeks as well.

10. Secured information – The information you submit, such as your phone number, email address, income, bank account information, and social security number is always secure. No good payday lender will ever sell personal information to other businesses. This actually falls under the privacy law and its very difficult for them to sell your personal info. They can of course sell you offers, but cannot sell your personal info to anyone. Usually, you will be sending the information over a secured network if applying online. For example when you apply a loan with us, your information is secured when its traveling so in case if a hacker hacks – they cannot make anything out of it. Just make sure that you are dealing with a trustworthy payday company.

Payday loan is indeed a good option to solve a sudden and unexpected cash crunch situation, which can happen to all of us. It is certainly cheaper than losing your home or car. It lets you avoid the embarrassment of having to approach friends or family for urgent financial help.

Apply Your Payday Loan Here.

Most of us face financial emergencies in our lives. In fact, you will rarely see a person who hasn’t been through a tight phase at least once. It’s entirely possible that you have a lot of assets of your own, but they are all locked away in real estate, bonds or such other financial instruments that cannot be taken out so easily and quickly. And of course, you might not even want to sell off these assets too, as the liquidity crunch is likely to be temporary.

So what do you do when you face a liquidity crisis? Perhaps you need a bit more money than what is there in your bank account. Some of us cut back expenses to make both ends meet. But that is not always possible, particularly when you have to pay a rather large sum of money towards urgent home renovation that cannot be delayed, fixing a problem with the car, or the payment of medical bills. Or maybe you have to visit your dear old aunt overseas who is possibly seeing her last few days because of poor health.

There are those who would approach friends and family for the urgent cash. But many don’t want to do this as this could be very embarrassing. After all, you don’t want to take a favor from anybody, if you can avoid this.

And besides, you could embarrass the ones you approach as well. They don’t want to say “no” to you, but are compelled to deny you the funds because they could themselves face a hard financial situation. In other words, there is simply not enough adequate disposable cash that could be loaned to you. So in the end, your friends and family will try to find all excuses to avoid you. Now, that’s not a happy situation.

So we can say that borrowers ask for payday loans for these 3 reasons.

1. To solve their immediate liquidity crunch.
2. So that they don’t have to cut back expenses by too much, and because sometimes, even living on the basic necessities isn’t going to be enough.
3. So that they don’t have to approach their friends and family for money.

Recent Study Reveals a Surprising Finding

However, a recent study that was carried out by a division of the Pew Charitable Trusts reveals something new. According to their findings, 41% of borrowers are saying that they have to approach friends and family for cash infusion to pay off their first payday loan. So these people have to do what they were trying to avoid in the first place. The report further says that some of these people have even had to pawn their personal stuff, or take second payday loan to repay the original.

Pew Charitable Trusts report says that borrowers are facing a problem because the average American can pay back just $50 each week, but with these loans, they have to repay $400 in a couple of weeks. Sometimes, the debt period is extended, and so, the borrower ends up paying $500 as fees over five months.

Not Everybody Agrees

The Community Financial Services Association of America has contested the findings of this report. They are pointing out one basic shortcoming – lenders get a large deposit of funds on the payday and most people are easily able to pay off the entire loan without any problems whatsoever.

The association is also pointing out that typically the fee charged is anything between $10 and $15 for a loan of $100. So for a $1000 dollar loan, the total fee would come to between $100 and $150 maximum. A payday loan above $1000 is rarely offered, so borrowers don’t have to pay $500 towards fees as reported by Pew Charitable Trusts.

The Community Financial Services Association of America says that small dollar loans are extremely important short-term credit products. This is an important tool for those who need funds urgently to manage a sudden shortfall or pay an unexpected expense. Without these loans, a lot of people would be in serious trouble. It would only bring down the financial health of the country.

However, having said this, it is important to remember here that payday loans should be taken purely to solve sudden emergencies, and not for luxuries. You shouldn’t go on a weekend trip with this money, or buy a new swanky gadget with the funds. Only borrow what you absolutely need for a real emergency, and nothing more, and everything should be all right.

Even the Banks Are Going Into Payday Loans Now

There is no threat to the payday or small dollar loan business. There is no threat to most borrowers who are taking these loans. You might be surprised to know that even the biggest and the most credible banks are getting into these loans now. It is not a direct association though as the banks are not offering these loans to the borrowers directly.

The New York Times has reported that banks such as the Bank of America, Wells Fargo, and JP Morgan Chase are becoming behind-the-scene allies of online payday lenders.

Also, there is increased scrutiny now on the operations of payday and small dollar loan lenders. Federal regulators are monitoring the businesses closely. So the industry has become extremely regulated. Most lenders follow all laws and directives. In fact 100% of our lenders follow the laws of lending in their state – otherwise we don’t work with them. But it’s still advisable to be sure about the company’s credentials before borrowing the cash. If you are seeking a payday loan, always deal with a good company with credibility.

Most borrowers have also revealed that the loan terms are clearly mentioned. There is no ambiguity about this. So that is good news.

Go ahead and take a payday loan from us. There is really nothing to worry about. Why approach your friends or family and face embarrassing situations, when you can get the cash advance easily and quickly?

The best part about our loans is that, you can apply online from the privacy and convenience of your home and get the money deposited directly to your bank account the very next day. Nobody has to know about your financial troubles.

Everything happens really quickly, sometimes in less than 48 hours. That is excellent news because you will surely want the cash quickly in an emergency. And there are no hassles too, as there is no questioning on why you need the funds, no credit checks, and no long standing at queues. And yes in case you are unable to pay just inform your lender one day before the payment is due. They will surly arrange something for you. We are very helpful towards our customers and try our best to give a loan to everyone who applied.