Payday Loan Industry Is Growing in 2021: What You Need to Know

Payday Loan Industry Is Growing in 2021 What You Need to Know

In the field of microcredit, one significant news is currently being discussed. It lies in the fact that over the past months of 2021, the share of online payday loans has grown significantly – at the moment it has reached its historical maximum. As a percentage, this is 29.6% of the total mass of short-term loans. Such data were provided by the Bureau of Economic Analysis (BEA), which includes 80% of all companies that are engaged in microfinance.

Comparing indicators for online loans in 2021 and 2020

In the first quarter of 2021, 2.7 billion dollars of loans were issued. Compared to the first quarter of 2020, this amount increased by 18.8%. But the indicators related to online payday loans are much more interesting. They account for almost 825 million dollars, which is 40% more than in the same period (the same first quarter) last year. The growth of the offline portfolio is also noticeable – within the quarter it grew by 2.3%, and within the year – by 11.7%. As a result, as we can see from the numbers, the greatest growth in the microcredit market happened precisely because of the active development of online payday loans.

Probable reasons why payday loans are gaining popularity

In turbulent times, everyone may need urgent financial support. Sometimes it happens that the money runs out at the most inopportune moment, a few days before you get your next paycheck. At the same time, there is no point in contacting a banking organization. In such cases, emergency measures will be required since it is difficult to survive in an urban environment without means of subsistence. Therefore, the only correct way to cope with this situation is to contact microfinance organizations that offer same-day loans online.

Today, you do not need to visit a company’s office to conclude a loan agreement and get the money. Today, all of this can be done over the Internet. Before applying for a cash advance loan, you need to take into account that each microfinance organization has its own rates and terms and they may vary significantly.

Currently, almost any person can get accepted for a short-term speedyloan because borrowers do not go through strict control. Even a bad credit history will not be an obstacle.

The main convenience of such loans is that you do not need to go anywhere to get them. All you need is a computer device and an internet connection. What about paperwork? You only need some kind of identity verification (driving license, SSN). It doesn’t take a lot of time to complete the questionnaire. The entire procedure can be performed on the lender’s website. As a rule, it takes no more than an hour to process an application. The borrower can choose how to receive the money and when to pay it back.

If necessary, the loan can be easily extended. To do this, you should contact the lender a few days before the predetermined due date and perform certain manipulations.

It does not take a lot of time and special skills to get such a loan. The entire procedure is transparent, safe and legit. The only thing that can stop some people is an increased APR. But this is understandable. Payday loans are typically easier for people to qualify for than regular bank loans. For this reason, they usually come with higher interest rates. The additional cost ensures that lenders make money off their loans, even if a borrower defaults. Moreover, these loans are short-term, which means they will be repaid quickly, so the overpayment will not be significant.

What is important to remember when choosing a payday lender?

The ability to take out a loan via the Internet is both an additional opportunity and a great responsibility. Since this topic is very popular now, various scammers and dummy websites have become active. If you need to borrow money, carefully study the information about the company and also make sure that it operates within the law.

Most payday lenders offer you not only transparent terms of cooperation and compliance with the current US law but also the opportunity to borrow funds without insurance, collateral and hidden fees. They honestly announce the interest rate because they strive to attract customers on an ongoing basis, to maintain their reputation. Applying for online payday loans via the Internet, you can solve your unexpected money issues quickly and easily.