Friday, August 31, 2012

Economical Benefits Of Payday Loans



bad credit payday loans
Payday loans have numerous benefits that we cannot deny. For individuals, payday loan is like a hope. Payday loans help people around the globe to fight against poverty and financial issues. Bad credit payday loans are helping those with poor credit scores to improve their credit history. Fast payday loans lenders like www.badcreditpaydayloansusa.net are helping local people for several year.

Besides personal benefits, payday loans have several economical benefits as well. I mean, payday loans also help economy of the country in different ways. Let's see how payday loans help our economy and country to grow.

1- Payday loans help those who have no other option left
It is said that only two types of people avail payday loans. First, poor people. Second, those who have no other option left for them. These are the ones who have failed to do anything whether it be business, job or anything. These guys do nothing. And payday loans by helping these “failures” help them in coming back to the main stream. With cash in their hands, they try to do something for them. So this way, payday loans are encouraging people. It consequently results in an increased GDP.

2- Increase in welfare
No doubt, payday loans have increased household welfare. Since poor and those without money can now have an easy access to money and cash via payday loans, this ultimately results in an increased welfare. Increase in household welfare impacts the overall economy of the country positively. And yet, this is another great benefit of payday loans.
However critics believe that payday loans are not good for welfare at all. They say that payday loans do not increase household welfare because these are too expensive. Due to their high interest rate, payday loans do not increase welfare rather these loans negatively affect welfare, and thus affecting economy of the country badly.

3- Help people in case of natural disasters
It has been researched and proved that payday loans have helped people a lot at times of disasters and natural calamities. A detailed study was conducted in 2009 in which disaster areas were compared to each other. It was seen that disaster areas where payday loans were available to the people reported to have less causalities than those disaster areas where payday loans were not available.
And yes, it is a fact that at time of disasters or I must say sudden natural disasters, people need money instantly to get themselves out of trouble. If they have an access to payday loans, they can help themselves quite easily. For instance, they can move to a safe place. They can buy medicines for themselves. They can help others. And so on. All this actually positively boost the economy of the country. Although due to the natural disaster, economy does not seem to be moving in the right direction but payday loans indirectly do affect economy positively via helping people in such situations.

4- Keeps on circulating the money
Payday loan lenders take money from rich and give it as payday loans to the poor. In other words, payday loans help in circulating the money. The money moves from rich to the poor which is the sign of a healthy economy.
Critics are of the view that its rich who is becoming richer and poor is becoming poorer. Poor pay high interest rates on payday loans, and rich by investing in payday lending companies earn profit higher than normal. So this way, money does not circulate rather it is being shifted from poor to rich. This actually affects the economy badly instead of helping people and economy to grow.

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