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Who Buys Source

Profiling adults 18+ who visited a cash-advance loan company or used a check-cashing service in the past year:

GfK MRI, 2010

Adults 18+ who visited a cash-advance loan business in the previous year, by income bracket: $100,000+, 14.8%; $75-99,999, 11.9%; $60-74,999, 12.6%; $50-59,999, 9.3%; $40-49,999, 12.6%; $30-39,999, 12.4%; $20-29,999, 13.6%; Under $20,000, 12.8%.

GfK MRI, 2010

Adults 18+ who went to a cash-advance loan company in the past year, by race: White, 62.6%; Black, 24.0%; Other, 13.4%; Hispanic origin, 14.3%.

GfK MRI, 2010

Of those adults 18+ who visited a cash-advance loan business in the last year, 52.9% were women and 47.1% were men.

GfK MRI, 2010

Adults 18% who went to a cash-advance loan company in the past year, by age group: 18-24, 13.0%; 25-34, 22.0%; 35-44, 28.3%; 45-54, 19.9%; 55-64, 10.0%; 65+, 6.8%.

GfK MRI, 2010

Adults 18+ who used a cash-advance loan company in the last year, by region: Northeast, 10.2%; Midwest, 23.7%; South, 42.5%; West, 23.6%.

GfK MRI, 2010

Adults 18+ who visited a cash-advance loan business in the last year, by marital status: Single, 27.5%; married, 49.8%; separated/widowed/divorced, 22.7%.

GfK MRI, 2010

Of those adults 18+ who used a check-cashing service in the past year, 55.2% were women and 44.8% were men.

GfK MRI, 2010

Adults 18+ who used a check-cashing business in the previous year, by age level: 18-24, 20.3%; 25-34, 22.8%; 35-44, 18.9%; 45-54, 14.7%; 55-64, 9.8%; 65+, 13.5%.

GfK MRI, 2010

Adults 18+ who used a check-cashing service in the past year, by income group: $100,000+, 14.4%; $75-99,999, 10.0%; $60-74,999, 11.4%; $50-59,999, 5.7%; $40-49,999, 12.8%; $30-39,999, 14.6%; $20-29,999, 14.7%; Under $20,000, 16.4%.

GfK MRI, 2010

Adults 18+ who utilized a check-cashing service in the last year, by race: White, 62.6%; Black, 21.3%; Other, 16.1%; Hispanic origin, 16.9%.

GfK MRI, 2010

Adults 18+ who used a check-cashing business in the past year, by region: Northeast, 22.2%; Midwest, 20.3%; South, 39.3%; West, 18.2%.

GfK MRI, 2010

Adults 18+ who used a check-cashing business in the previous year, by marital status: Single, 33.1%; married, 45.1%; separated/widowed/divorced, 21.8%.

GfK MRI, 2010

Based on a study by the George Washington University School of Business, the age range of payday loan customers: Less than 35, 29.3%; 35-44, 23.4%; 45-54, 22.7%; 55-64, 16.1%; 65+, 9.5%.

Community Financial Services Association of America, 2010

According to research by the George Washington University School of Business, 61% of payday loan customers have household incomes of under $40,000.

 

Community Financial Services Association of America, 2010

Percentage of U.S. households that an FDIC survey determined to be underbanked (those that have a checking or savings account that rely on alternative financial services), by race/ethnicity: Black, 31.6%; American Indian/Alaskan, 28.9%; Hispanic, 24.0%; Hawaiian/Pacific Islander, 16.4%; White, 14.9%; Asian 7.2%.

FDIC, 2010

Percentage of U.S. households that an FDIC survey determined to be unbanked (those without a savings or checking account), by race/ethnicity: Black, 21.7%; Hispanic, 19.3%; American Indian/Alaskan, 15.6%; Hawaiian/Pacific Islander, 9.2%; Asian 3.5%; White, 3.3%.

FDIC, 2010


Why They Buy Source

A survey of financial service center customers, conducted by the Financial Service Centers of America organization, determined that the most important variable in choosing one of these stores is, by far, location.

Financial Service Centers of America, 2010

How They Buy Source

According to the Community Financial Services Association of America, to obtain a payday advance, a customer is required to have an active checking account, proof of regular income and proper identification. Upon completion of an application and approval, a borrower must read and sign an agreement containing disclosures required by the Truth in Lending Act, and write a personal check for the amount of the advance plus a fee. The lender immediately advances the customer funds, but holds the check until an agreed-upon date (usually within 2 to 4 weeks) when the borrower receives his/her next paycheck. On the agreed-upon date, either the check is deposited, or the customer returns with cash to reclaim the check.

Community Financial Services Association of America, 2011

What They Buy Source

A payday advance is a small-dollar, short-term loan. Typically, a customer uses a payday advance to cover small, unexpected, expenses between paydays, or avoid costly bounced checks, overdraft protection fees, late bill payment penalties, or other less-desirable short-term credit options.

Community Financial Services Association of America, 2011

According to a survey conducted by the Federal Deposit Insurance Corporation, approximately 66% of unbanked households (those without a checking or savings account) use the following alternative financial services: Non-bank money orders and non-bank check-cashing, pawn shops, payday loans, rent-to-own agreements, and refund anticipation loans. About one-quarter of unbanked households do not use any alternative financial services, suggesting a strong reliance on cash transactions.

FDIC, 2010

Payday loans usually range from $100 to $500, although some states permit loans up to $1,000. Finance charges are typically between $15 and $20 per $100 of the loan amount.

Community Financial Services Association of America, 2010

Based on a survey of members of the Financial Service Centers of America, types of services these businesses provide: Check cashing; money orders; virtual bank accounts & savings programs; ATM access; bank withdrawals and balance inquiries; public transit metro cards; electronic tax preparation and filing; DMV license plates and title pickup; electronic bill payment services; payday advances; wire transfers; debit cards.

Financial Service Centers of America, 2010

Where They Buy Source

Cash America International operates more than 1,000 Cash America Pawn and SuperPawn Shops, while also offering cash advances through some 250 stores operating as Cashland and Cash America Payday Advance. Cash America also offers check cashing, money orders and money transfers through about 130 Mr. Payroll stores. EZCORP operates some 400 pawn shops, and offers payday loans through some of these stores, as well as some 500 EZMONEY outlets. First Cash Financial Services operates more than 550 pawn shops, while also offering short-term loans, payday loans, check cashing and money orders.

Hoover's, 2011

Among the other leading chains in the downscale financial services industry are: ACE Cash Express (offering check-cashing services and other financial services through 1,800 ACE Cash Express and ACE Cash Advance locations); Check Into Cash (providing payday advances through more than 1,100 stores); Advance America, Cash Advance Centers (offering payday loans through approximately 2,500 outlets); Dollar Financial Corp. (with more than 1,100 check-cashing/payday loan stores operating under such names as Money Mart, Loan Mart and Money Shop); Check 'n Go (offering payday loans through 1,000 branches);  QC Holdings (with 550 payday loan stores functioning under the names California Budget Finance, First Payday Loans, Nationwide Budget Finance and QC Financial Services),  and Quik Cash); and World Acceptance Corporation (offering short-term and medium-term loans through approximately 1,000 offices).   

Hoover's, 2011

Business Trends Source

Estimates of the value of the alternative financial services industry run as high as $320 billion. 

The Washington Post, 2011

Based on a study by the Federal Deposit Insurance Corporation (FDIC), close to 30 million U.S. households are either unbanked (those without savings or checking accounts) or underbanked (those that have a checking or savings account but rely on alternative financial services).

FDIC, 2010

As many as 56 million Americans rely on financial service centers in addition to or instead of traditional financial institutions, such as banks or credit unions, when conducting their routine financial business.

Financial Service Centers of America, 2010

A study by the Federal Deposit Insurance Corporation determined the banking status of U.S. households: Banked but not underbanked, 70.3%; underbanked, 17.9%; unbanked, 7.7%; banked, but underbanked status unknown, 4.1%.

FDIC, 2010