Misconceptions About Payday Loan Customers

You’ve probably heard critics speak of the payday loan industry in unflattering terms. They say that payday loan companies prey on the poor and those who have no other options for borrowing money. Some claim that this industry takes advantage of people who don’t know any better. But these are broad accusations made without specific evidence to back them up. MyCashNow, on the other hand, knows exactly who our customers are, thanks to a demographic survey we conducted earlier this year—and the results should surprise the critics.

There’s a common misconception that only low-income earners need a quick payday loan. A full 45% of our respondents reported a household income of $50,000 or greater. Even those who earn a good salary can still find themselves short of cash when bills come due before they get their paycheck. Not surprisingly, different customers also listed many different reasons they had for taking out a loan.

Among those who responded to our survey, 50% said that they applied for a quick payday loan to pay for unexpected bills. Another 27% told us that they use our short-term cash loans to cover expenses that they knew about, but still couldn’t cover without a helping hand. Another 14% said that they use MyCashNow to make up for credit problems. Four percent of applicants rely on our quick loans to pay for expenses related to a divorce or separation, while two percent need fast cash to cope with a new addition to the family. And three percent list “other” as the reason they need a payday loan.

What’s more, 98% of our customers reported having a high school diploma, 42% have some college experience, 32% have a four-year college degree, and 8% have postgraduate degrees. This is hardly the ignorant customer base that the critics portray. There is no one profile or picture that defines our customers.

Critics will continue to accuse the payday loan industry of targeting poor and uneducated customers, but the data shows that these allegations are simply false. Our customers are just like everyone else, spread across a wide demographic base. So the next time that you hear someone make a blanket judgment about payday loan customers, you’ll know better.