For a better understanding of how to talk about what’s right with your short-term loan programs, check out what’s wrong in other institutions’.
According to The Consumerist, 13 states consider payday loans or paycheck advances to be loan sharking. The website even provides a handy illustration that shows how a $200 advance can turn into a $920 debt, complete with collections encounters and possible property seizures.
The comments of one reader – “I actually had a hard time wrapping my brain around the idea of 'Predatory Lending', until I read this…” – demonstrates how consumers need and appreciate financial education.
In early May, Callahan & Associates hosted a webinar for credit unions that want to fill the need in their communities for responsible short-term loans. Unlike predatory lenders, credit union short-term loans foster the growth of financially healthy members and increase loyalty among those that choose to use such services. But just as consumers appreciate knowing what to avoid, they also need to know what responsible options are available. The Consumerist flowchart highlights what is wrong about short-term lending, how can you use that knowledge to spotlight what is right about your programs?