Payday advances and short-term installment loans prey in the urgent need of individuals for small-dollar quantities and cost very high costs and interest towards the borrowers. PayActiv has continued to develop a genuine option to pay day loans that can help ordinary employed individuals avoid these debt-traps of predatory financing and start to become self-reliant in handling their costs.
In the last few years, state and regulations that are federal been passed away to regulate the cash advance industry to be able to protect consumers through the misleading methods of loan providers. The lenders have introduced an off-shoot of payday loans called short-term installment loans, which allow borrowers to repay the loans over six months or longer, but an average borrower still ends up paying 2 to 3 times of the borrowed amount despite that, in response to the opposition of single-payment loans.
Importance of small-dollar loans
Estimated 40% of populace that are either unbanked or underbanked (25% of U.S. home) borrow through small-dollar loans, rent-to-own agreements, pawn stores, or reimbursement expectation loans (FDIC, 2009). Continue reading Option to Payday Advances: Self Reliant Selection. Importance of small-dollar loans