Money advance lenders don't consider race

There are claims that cash loan advance loan providers purposefully exploit minorities. The poor individuals of non-Caucasian origin are exploited by hateful short term installment loan lenders, or so goes the idea. That is not the case at all. Cash advance store location is based on desire, and more goes into it than just ethnic background. There isn’t a business on earth that does not adhere to that rule.

Locating the group of money advance stores

Numerous individuals think that payday loan companies all move into areas to target certain races with their products. The Center for Responsible Lending released a record that purported payday loan providers in California clustered in areas in which predominantly African Americans and Latinos were located. Check cashing is accessible in most of these areas. They’re just places financial services tend to be available. A study had been done in 2009 by Robin Prager that showed that areas that had a population mostly under 40, was urban and rural, and lived around the poverty level were the typical areas payday loan companies would set up shop. If payday lenders only lent loans for a bad credit score to individuals who couldn’t afford to repay, they would soon be out of business.

Area of supply is based on the demand

To argue that a business locating where there is demand for their services is predatory simply due to the demographics of the area is patently ridiculous. If that was the standard, marketing to any demographic besides everybody is predatory. This has shown that targeting a minority is considered predatory because you are giving them what they desperately need. That means the clothing company that offers heavy coats that can withstand temperatures as low as negative 80 degrees is being predatory in Alaska because it is not also offered to those in Arizona.

Economics determines every little thing

Correlations do not necessarily end in trigger and effect relationships. That makes sense. Personal loan companies can’t lend to those who cannot pay the money back. This would end in a decrease of money rather than a profit and the shops would close. The businesses would all die off fast if this were the case. You can read more in the payday lending facts and statistics record on Personal Money Store.