Where is the consumer credit?
March 30, 2010 | alternatives, federal legislation, industry, research | Comments (0)The Gerson Lehrman Group explains:
The available supply of consumer credit has dwindled due to credit card lines being dramatically reduced or eliminated and home equity lines being frozen or reduced because of falling home values.
What is the role of Alternative Financial Service providers to meet the demand?
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The Alternative Financial Services (AFS) space – payday lenders, pawnshops, rent-to-own stores, and auto title lenders -lenders – are all sources for low-dollar/short-term credit.One source of unsecured credit to meet this demand is the payday loan industry. In states that permit payday loans, households with checking accounts pay up to 13% less in overdraft and insufficient fund fees than in states that prohibit payday loans.
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