The latest salvo attacking the payday loan industry refers to the PEW Report as the ultimate authority. In fact, this PEW Report is used as ammunition against the industry on a recurring basis. However, as Tim Ranney the CEO of sub-prime consumer credit bureau Clarity Services wrote several months ago in a NY Times Op-Ed, this “report” has major flaws.
“Clarity processes more than half a million report requests per day for consumers seeking many different types of credit. We have data in our systems on about 35 million non-prime consumers. The data tells us a story significantly different than Pew’s results. Pew’s data says that the “typical” payday loan consumer has an income of about $30,000. Our research tells us the number is slightly over $50,000. Pew’s research says that only 49% of the population using payday loans are employed, and our research indicates the number is about 82%. Pew’s results are based on such limited data [Pew based their results and conclusions on survey responses from about 450 consumers nationwide.], yet all of the results they claim are skewed in a direction that perpetuates the view that the consumer is always a victim. The data we see leads us to different conclusions.”
Clarity Services is NOT a lender. Do they have a dog in this hunt? Sure. Do I? Certainly. But, I still have to ask, why isn’t hard data gathered by resources having significant insight into lending and consumer demand referenced rather than academic reseachers and media whores with an axe to grind and an unquenchable desire to sway opinion?
Stupid me! This B.S they spout sells newspapers. Whoops! Sorry!! I mean page views and clicks and advertising and political donations and funds PEW and the Center for Irresponsible Lending (sorry for mis-spelling) and on and on. It’s simply safer to attack us. And, it’s more profitable.
Look, we all know the traditional payday loan product is dead. But that doesn’t mean our customer is dead as well. Here’s a screen capture of a cool tool I use called Goggle Trends. You’ll note that the search terms “payday loans” and “cash advance” are trending higher today than they ever have.
Payday loan consumer demand increasing
So, what’s my point? Same theme: demand for small dollar loan products are at record highs. Smart operators having significant talent and exquisite customer service will continue to prosper nicely. As I’ve written so many times over the years, “The future is ours!” So all you “old timers” who played in this game in the good ol’ days can either evolve or remain a crocodile and scurry about in the swamps.
NOTES:
1) In all fairness, Tim wrote his Op-ed piece in March of 2013. Here’s a link to his original piece: Tim Ranney & to Clarity Services
2) Aljazeera, in their latest attack, labels Allen Parker Allen@Consultants4Tribes.com as “The Sovereign Matchmaker, the middleman payday lenders need to find Native American Tribes.” Here’s the link: Aljazeera
3) The Pew “Report” I referred to is here: PEW Report
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