Here are some quick details about the payday financing industry in Louisiana, published by LBP analyst David Gray.
- Based on industry representatives, payday financing was designed to trap borrowers in long-term rounds of financial obligation:
“The concept in the industry is that you’ve got to have that customer in, work to make him into a customer that is repetitive long-lasting client, because that is really in which the profitability is. ” – Dan Freeman, CEO of money America
“In a situation with a $15 per $100 price, an operator… will be needing a customer that is new sign up for 4 to 5 loans before that client becomes lucrative. ” – Stephens Inc.
- A Louisiana that is typical borrower have to take 9 payday advances every year to repay their initial financial obligation, leading to $270 in charges for a one-time $100 loan.
- The apr for a quick payday loan in Louisiana is 780 per cent, in comparison to a yearly portion price of 24 per cent for major bank cards.
ECONOMIC INFLUENCE AND PREVALENCE OF PAYDAY LENDING IN LOUISIANA
- The payday financing industry drained $46 million through the Louisiana economy last year. 1
- Louisianans paid between $181 million and $196 million in costs to payday loan providers last year. 2
- The payday financing industry led to a 671 web job loss last year. 3
- You can find four times as numerous lenders that are payday Louisiana as McDonald’s Restaurants. 4
- Louisiana has on average one payday lending storefront for each and every 4,800 residents. 5