In the general public belief and partly in the common practice of loan companies, it has been established that payday loans are a financial product addressed to debtors. To people who for various reasons will not receive a standard loan (for higher amounts) and who can forget about a bank loan at the start. Recent months on the financial market show, however, that this trend is starting to change.
Another group of debtors is still joined by another: young people between 18-23 years of age who take out loans for consumption. The most frequently indicated reason for reaching for a financial commitment is the desire to buy a telephone or other electronic equipment, the first car or a trip abroad. In the vast majority of cases, borrowers from this group do not yet have a stable source of income, employment contract or other financial security, which is why payday loans as proof prove to be the ideal solution for them.
What about repayment?
An interesting statistic is that of how such loans are taken out by young people. It may surprise you that, contrary to appearances, there are no major problems with it. Only 15% of borrowers before the age of 23 have delays in paying their debts. The reason may be low installments for this type of loans and the repayment deadline spread over time; they are not amounts reaching hundreds of dollars, but usually several dozen or in the case of small loans, even several dollars per month.
Payday loans for proof and credit history
Experts point to one more interesting phenomenon related to loans granted for the identity card itself. For young people, it’s a great way to start building a positive credit history. Incurring a small liability even for a thousand dollars and paying it off on time – even with the same money – will allow you to enter in credit registers as a reliable and timely lender. And this has an impact on future loans and borrowings, which will be easier to obtain.