Payday loan market spreads its tentacles
STRUGGLING families are getting hooked on payday loans to cover credit card and other expenses.
Couples on combined incomes of up to $ 150,000 are borrowing to pay bills because they don’t know how to budget.
Australia’s emergency cash market has ballooned to $ 1 billion a year and is expected to double in three years as online loan applications grow, Digital Finance Analytics estimates.
Business was split between the socially disadvantaged and others on better incomes in temporary crisis needing access to fast money, DFA principal Martin North said.
Cash Converters and Money3 have been joined by newer players such as Nimble.
Payday loans are typically for $ 100 to $ 2000 and can be approved as quickly as an hour.
They are repaid over 16 days to 12 months, usually by regular direct debit.
Charges on a one- month loan are the equivalent of up to 240 per cent annualised inter- THREE weeks can seem like a lifetime to a kindy student, but kids at Goodstart Early Learning Centre at Idalia have waited patiently for their newest classmates to arrive.
Teacher Yasmin Hunter said the class had been learning about life cycles and last week welcomed four baby chickens.
The class brought in an incubator, sourced eggs and learned about the daily changes occurring inside the egg.
The students are now the est, plus extra fees for missed repayments.
Ahead of a federal review of regulations, cases reported to News Corp Australia include:
PAYDAY loan “addicts” getting up to 70 loans over three years.
A HOMELESS disability pensioner unable to keep up with repayments on a $ 600 loan used for pillows, a sleeping bag, food and clothes.
A MAN on a carer’s allowance juggling 10 pawnbroking and payday loans at once.
TEXT messages and emails proud caretakers of David, Seaweed, Omelette and Sweaty Pants and they could not be happier.
The children have also tended to their own vegie patch and planted seeds.
Ms Hunter said the children enjoyed being hands- on, and would soon be learning about recycling and composting.
“They get to learn about their environment, their impact on it, and help out at home,” she said. enticing customers out more loans.
DODGY assessments of how much some people can afford to repay.
Melbourne- based Consumer Action Law Centre chief Gerard Brody is calling for reduced fee caps, bans on unsolicited marketing and stronger limits on the percentage of income allowed for repayments.
National Credit Providers Association chairman Paul Walsh said that, while problems “may still fall through the
take cracks”, lending practices had improved since stricter rules were introduced two years ago.
At least 90 days of bank statements had to be checked before approvals and more than two loans in 90 days was presumed unsuitable unless extra inquiries were made.
Consumers were not always upfront about their circumstances or other debt, he said.
“As other measures such as comprehensive credit reporting come on board there will be even more protection for consumers,” Mr Walsh said.
EXCITING ARRIVALS: Abigaile Appleton, 4 ( main picture) and ( above) Joshua Doyle, 4, Darcy Kasper, 3, and Bodhi Cattel, 4.