Dec 12, 2018 Philip Burgess
Short term lenders have continuously contended with poor public perception. The industry's good name has been tarnished by businesses partaking in poor practices, which often cause lawmakers to intervene.
The fact of the matter is, the majority of short term lending firms simply try to provide those in need with a way to accumulate good credit. Most of the loans range from low triple-digit numbers that are used to pay electric, phone and other bills. Using the money provided by quick lenders for these purposes not only maintains quality of life, but helps consumers aggregate positive credit data.
Allowing best practices
According to The News Leader, the Ohio Supreme Court recently ruled that short term lenders will not be hindered from implementing high-interest loans despite a law that was approved by legislators in 2008. On June 11, justices maintained there's nothing preventing such businesses from providing single-installment, share-bearing allowances.
Finding a new strategy
Ohio's Short-Term Lender Act caps the yearly percentage rates charged on such loans, with supporters of the bill maintaining that the practice entraps people in debt. To continue providing low-income consumers with legitimate ways of obtaining financial assistance, lenders throughout the state capitalized from the flexibility of Ohio's Mortgage Loan Act.
As a result, the ruling made at the end of May showed that no short term lenders were registered under the Short-Term Lender Act, while 236 organizations filed with the Mortgage Loan Act, allowing them to offer temporary loans that are payable in single installments.
By registering under the Mortgage Loan Act, short term lenders operating in Ohio were able to meet the needs of consumers throughout the state. The fact of the matter is, people wouldn't be approaching those companies if they didn't have a valid reason for doing so.
Furthermore, Ohio's recent ruling allows those organizations to utilize the digital realm. Although short term lending may be ruled by brick-and-mortar businesses, consumers are beginning to search for such services on the Web, which provides them with a wide array of options.
The Internet: The next frontier
The Digital Journal noted the successes of personalcashadvance.com, a short term lending enterprise that has benefited from 2014's steady economic improvement. The organization announced that the number of consumers seeking its services has risen dramatically since the beginning of this year, with percentages increasing every day.
The business's digital setup allows it to reach millions of consumers residing within the United States. Because it caters to such a broad range of customers from different corners of the nation, personalcashadvance.com leveraged its platform to provide fast, easy-to-understand lending solutions to prospective clients.
The news source acknowledged that financial analysts have deduced that procuring short term loans online is going to become a more frequent practice in the upcoming years.
Improving oversight, abilities
Operating in the digital realm not only allows short term lenders to quickly provide service to the needy, it enables them to allay the concerns of over-critical lawmakers. If any suspicions regarding an organization's practice comes into question, an accurate record of all transactions can be presented to them.
In turn, this method of conducting business will insight a demand for advanced Software-as-a-Service solutions. Aggregating an incredible amount of financial data from consumers across the nation requires cloud-based technology capable of quickly collecting and processing digital information. Such an environment also provides short term lenders with the option of using analytics tools.
Utilizing data analysis programs can provide businesses with specific insight regarding their customers. For example, a short term lender could figure out which contingency of people is most likely to take out loans to pay electric bills, and what region of the country they originate from.