Madison Rosamond Floyd 4 years back Views:

1 Community Financial solutions Association of America (CFSA) pay day loans and also the Borrower Enjoy: Executive Overview delivered by: Harris Interactive advertising analysis 4, 2013 december

2 dining dining Table of articles techniques. 3 Sampling Method. 3 Information Collection Method. 3 Report Notes. 3 Overview of Detailed Findings. 4 Value and need for Payday Lending. 4 Informed Borrowers with Accurate objectives. 6 The Facts about Lenders. 7 Attitudes and Views on Government Regulation. 8 Appendix. 9 guidelines provided for user organizations for test pull

3 Sampling Method Methods CFSA ed 12 member organizations welcoming them to incorporate their client

information within the test pool with this study, with guidelines for pulling the test connected (see Appendix on pages 9-10). User businesses had been instructed with their test files right to Harris Interactive, and never to duplicate anybody from CFSA. Four user businesses reacted and offered Harris with a list that is complete of clients whom came across the sampling requirements. One user business reacted and supplied Harris by having an arbitrarily chosen selection of 10,000 of the clients whom met the sampling requirements. A complete of 281,031 documents had been gotten by Harris through the five participating user businesses. Harris Interactive handled all sample preparation that is further. Test files were de- duped (meaning duplicate records had been removed) centered on telephone number, and 10,000 documents had been arbitrarily chosen from each business (apart from the organization which delivered a complete of 10,000 records 9,667 usable records had been chosen using this business). Quotas had been set during interviewing to ensure 200 finished interviews had been acquired from each business. Data Collection Method All information collection had been carried out by telephone in the united states of america by Harris Interactive with respect to Community Financial solutions Association of America (CFSA) from October 9 24, 2013 among 1,004 participants, ages 18+, who will be clients of shop- front organizations in the CFSA, and took down a two- week pay day loan of $700 or less, that they made repayment that is final of July or August of Report Notes Information are unweighted and therefore are a agent probability sample associated with the populace have been surveyed. o With an example with this size, the expected sampling mistake is +/- 3%. Throughout this report o Qualified participants (described in information Collection Method above) is going to be known as Borrowers. o The expression newest cash advance experience will make reference to the mortgage borrowers paid back in July or August of 2013 whether or not they will have applied for a unique loan since, since this ended up being their newest, complete experience with a loan that is payday. 3

4 Value and Demand for Payday Lending Overview of Detailed Findings Borrowers recognize some great benefits of payday advances and appreciate having them as a short- term choice for bridging gaps that are financial. Almost all borrowers suggest they appreciate getting the solution to simply just take down an online payday loan (95%). Nine in ten (89%) agree totally that they feel more in charge of their financial predicament due to the solution to just simply just simply take a payday loan out if they want it, and over two- thirds (68%) think that minus the choice of using down a quick payday loan, they might take even worse economic condition than they’ve been now. About nine in ten borrowers agree totally that payday advances can: o Provide a security web during unforeseen financial hardships (95%); o Be an intelligent economic choice whenever confronted with an urgent situation money shortfall (9); o Be well well worth the price simply because they be able to prevent belated fees on bills (89per cent); and o Help customers bridge a space within their finances (87%). Half (49%) of borrowers state they required the cash from a quick payday loan to fund a unanticipated cost ( a vehicle fix or medical crisis), and somewhat less report they had a need to spend ordinary costs between paydays (44%). Extra reasons some borrowers cite for needing an online payday loan include: o having to pay a belated cost for a bill (28%); o in order to prevent bouncing a check or overdrawing their banking account (23%); o to simply help away a friend or relative who required cash (19%); and/or o other explanation (10%). If up against a short- term financial crisis, and unable to spend a bill, borrowers overwhelmingly state they’d select the cash advance choice (a short- term loan asking a $15 charge for every single $100 lent, due to their next payday, 68%) over: o maybe not spending the balance and incurring a belated charge or penalty $30 (4%), or o Overdrawing their banking account and spending an overdraft cost of around $35 (3%). o One- quarter (24%) state they’re not sure which of the three choices they might select. The interest in payday financing is dependent on preference, as borrowers choose a quick payday loan over other available resources that are financial. borrowers report that after they required cash between paychecks into the last, they will have: o Cut done and spending without one thing they want (67%); and/or o Borrowed from family/friends (60%). Other financial solutions that borrowers state they usually have looked to in the past consist of: o Overdrawn their bank account and charged on overdraft charge (43%); o applied (41%); o Pawned a individual product (27%); o Bounced a check and charged a cost (25%); o applied for a advance loan on the bank card (17%); o applied an installment or name loan (15%); o applied an internet pay day loan (11%); and/or o something different (6%). 4