Clemson Universities Department of Economics study on payday loans concludes:
- No casual relationship between access to payday loans and bankruptcy filings for all payday loan borrowers as a whole (affirms YadYap belief)
- Access to high-interest-rate consumer credit correlates with improved household financial condition
Clemson Universities Department of Economics released a payday loan study recently that YadYap believes is noteworthy. This study was more than a simple study on payday loans. The study was conducted using data collected between 1990 and 2006. The purpose of the study was to determine whether or not payday loans lead to bankruptcy.
This study is a legitimate evaluation of important data and should be used by industry regulators when considering the types of regulation, if any, that should be made within the payday loan industry.
The researchers found two positive outcomes from the study. First, that access to high-interest-rate consumer credit correlates with improved household financial condition. Second, that there was no causal relationship between access to payday loans and bankruptcy filing rates for all payday loan borrowers as a whole.
Credible studies such as this should not be set aside. There is no reason that Clemson University would have to report anything other than the facts from a 16 year study of the payday industry. On the other hand, there are those in the industry that create a bad name for everyone by using less than ethical practices.
As for YadYap, this study affirms the belief we have that there is a need for this type of short term lending. YadYap is a marketplace where the best possible solution to short term loans will be offered to fill the need.
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