5 Reasons Why We Need Payday Cash Loans
Recently there was an outburst of criticism against the payday lending industry over the web. Hundreds of companies based in the US, UK, and countries of Central Europe were attacked by the payday cash loans opponents who view it simply as an effective instrument used to trick the disadvantaged and suck them dry.
It turns out that the whole thing triggered off because of a provocative article published in a local newspaper in Arizona where many companies had to close down their offices due to the strict APR limitations levied by the authorities.
Thousands of people have joined in to endorse the government’s iniciative and fuel the debate. Among the suggested alternatives regarded as cheaper and ‘less evil’ were long-term bank loans and credit cards.
However, after a quick research into the bunch one should realize that though there might have been actual users of payday cash loans at the very beginning, later on the discussion was lead by complete strangers who had nothing to do with it.
There were three things that slipped out of their sight. Firstly, it is a fact that demand breeds supply. Secondly, often neither of the two suggested substitutes provide lower interest fees. Thirdly, there are still so many obstacles associated with taking out a conventional loan quickly.
The five reasons below explain why an industry that is believed to be so shady has a right to exist and occupy its market niche.
1. Credit crunch
While it seems that the situation is getting better, here and there people still feel the aftersound of credit crunch. Some banks yet have not recovered and are reluctant to give out loans to someone who has bad credit history.
At times like these payday cash loans make for a perfect solution.
2. Swollen credit card debt
According to the statistics, the United States aggregate credit card debt amounts to $850 bln, which is close to $3,500 for each person.
Banks impose daily fees on credit card loans and sometimes even a piddling ten to fifteen bucks fee can get to be a real problem when you need money here and now.
3. Plunging APRs
Measures that the government is currently introducing in regard to the industry are more disciplinary than punitive. Thanks to it APRs on payday cash loans were capped at about 25 to 30 percent nationwide — almost equal to the interest rates some banks impose on credit card and conventional loan users — and are not seen to rise in the foreseeable future.
4. Emergency expenses
You can’t predict the unpredictable. Unforeseen expenses were and still remain the force that helps the instant loan lending stay afloat. There are many: a car breakdown, medical expenditure, home repair, legal expenses, community charges, and more. Mind that all of these are to be covered within just few days and it’s always quicker and easier to choose a payday loan.
That’s right, holidays. As easy as this. Banks close too early on weekdays and never open on weekends or holidays. Companies that give out payday cash loans are based online and provide customers around-the-clock service so that you get the money within 15 minutes. Makes sense.