The payday lending store has become a popular destination for millions of Americans across the nation. In the last two decades, fast cash loan lenders have grown to offer their services from more than 10,000 locations across the nation. The popularity of paydays is reflected in the annual loan volume reaching into the billions of dollars. Now, the popularity of payday advances has crossed the border into Canada.
Much like the States, fast cash personal loans in Canada are thriving. The cash advance business of providing short-term unsecured loans to cash-strapped consumers is not a new one, but fast cash lending has mushroomed in the last few years as payday lenders have diversified their services, drawing in a wider consumer base.
The client base has eclipsed the popular perceptions in both countries that personal loans cater to financially challenged low-income classes, with less education than patrons of traditional financial institutions, but this doesn’t reflect ground realities. Like their southern cousins, more and more Canadians are accessing payday loans due to their convenience of use.
Cash advances are short-term unsecured loans that are meant to be paid back by the person’s next payday. Generally, the loans are for small dollar amounts up to $1500, in some cases more. Access to payday loans is so convenient that no credit checks are performed in order to qualify for the loan. Most of the times, the only things required to get fast cash loans are a driver’s license, proof of employment income, and an active checking account. Traditional financial institutional lending from banks and credit unions is a complex and time consuming process. Even though these institutions offer loans, they offer nothing comparable to paydays.
Payday loans are unique in the financial industry, in that loans can be approved anywhere from a few minutes to within 24 hours. The big Canadian payday lenders and payday loan stores are expanding their services to other areas like money transfers, bill payments, and prepaid credit/debit cards. The lenders see diversification of their business into other areas of financial services as a natural progression towards meeting other financial needs of their payday customers.
Also, by offering other services they are able to attract other non-payday consumers. For example, payday lender Cash Stores Financial reports that approximately a quarter of its clients have an income of over seventy-seven thousand dollars a year. Payday loan lenders on both sides of the border have discovered that more and more of their client base has moved northward in terms of income level.
However, one common theme binds payday consumers on both sides of the border, the desire of convenient access to fast cash in case of urgent need. So far, only the payday industry has been able to meet that need, even in Canada.