I was recently watching my new favourite show, “Last Week Tonight with John Oliver” and to my surprise, a piece on payday loans was aired. It was a very humorous take on them, full of many interesting facts. It is in regards to payday loan companies in the USA, but in many instances it encompasses payday loans companies in Canada as well.
In the piece, Oliver states, “There are more payday loan stores in the USA than McDonalds or Starbucks.” Not to mention the fact that these stores have only been around for 20 years. That’s quite the growth rate.
Payday loans are marketed as “quick way to get the cash you need to cover an unexpected expense” and are called payday loans because the loan balance is typically due on your next payday. The problem with this is that most people can’t pay off the loan on their next payday. Therefore borrowers are charged an unreasonable amount of interest on the loan. Not to mention the fees that are included that you may not have been aware of. And so the endless cycle begins.
Oliver then goes on to talk about the top two payday loan companies in the USA, who were both charged with illegally overcharging service members. They present themselves as being there for you when you are in need, but they are actually just vultures, circling around you, waiting for their chance to swoop in.
Yes, there are regulations for these types of companies, but they ALWAYS find ways to work around the regulations so that they can continue to benefit from the misfortunes of others.
Unfortunately, payday loans are not going anywhere. A PEW survey found that “A majority of borrowers say payday loans take advantage of them, but a majority also say they provide relief.” That is why they are so dangerous. People sometimes need them. You have to be absolutely sure that there are NO BETTER OPTIONS.
A commercial starring Sarah Silverman was included in this piece. It’s definitely worth a watch.
Please check out John Oliver’s piece on payday loans. You will not be disappointed: https://www.youtube.com/watch?v=PDylgzybWAw
