Payday advances and short-term installment loans prey regarding the urgent need of men and women for small-dollar quantities and cost extremely high charges and interest towards the borrowers. PayActiv is promoting a real option to pay day loans that can help ordinary employed individuals avoid these debt-traps of predatory financing and turn self-reliant in managing their expenses.
In the past few years, state and regulations that are federal been passed to manage the pay day loan industry to be able to protect customers through the misleading methods of loan providers installment-loans.org/payday-loans-la/. 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.
Dependence on small-dollar loans
Estimated 40% of populace that are either unbanked or underbanked (25% of U.S. Household) borrow through small-dollar loans, rent-to-own agreements, pawn stores, or reimbursement expectation loans (FDIC, 2009).