Banks Offering Payday Loans

As more states across the U.S. cap interest rates on payday loans, a number of the major banks are now offering a financial package which is very similar. Some people may argue its simply a wolf dressed up in dainty sheep-like clothing.
After all, if banks and credit unions can get away with lending $100 for a fee of $7.50, which in essence is an annual percentage rate (APR) of 261%, then why shouldnít they? Its still a whole lot cheaper to the consumer than the typical 400% + APR which is levied on the borrower by payday loan companies.
Whatís more, its also a lot cheaper than the ìoverdraft protectionî that many banks offer. That can land a consumer with a $35 bill for an overdraft of only a few cents.
In Maryland, the banking institution ñ Wells Fargo ñ is considering introducing a direct deposit advance product. The state of Maryland has legislature in place which caps small loans with an interest rate of 33% but this does not apply to major banks.
The main problem here is that this type of loan is most attractive to low income bracket households ñ people who tend to live paycheck to paycheck. Because of this, if thereís a sudden shortfall in the amount of cash required, it becomes a very attractive proposition to either opt for a payday loan or something very similar in nature.
Thus, its all very well for those who have a chunk of disposable income at the end of every month to nay say and gloat over people who are less fortunate and who have to simply live on the tightest of margins due to earning a wage that leaves them close to a minimum wage. But when it comes down to it there are times when there is no alternative than to borrow using a payday loan or a similar financial product.

Are There Any Alternatives?

Yes, there are. Here are a few:
- Instead of opting for a payday loan or a similar type loan, ask your employer for an advance
- If you have any surplus items at home ñ perhaps in a garage or stored in the loft ñ consider selling them on eBay or Craigslist
- Take on a part time job in addition to your full time work, or ask to do some extra hours each week at your main job
For more information about payday loans and whether they are suitable for your needs, please visit paydaypete.co.uk .

Why More and More People Are Opting for Prepaid Debit Cards

It’s a quite obvious that prepaid debit cards – those cards that you deposit load of cash, and spend from here and there – are quite hot.
Research shows that in 2009 alone, consumers approximately loaded $29 billion on such cards. These cards are very popular among young adults and those who are considered as underbanked (people with little access to typical financial institutions, such as banks). On the following year, the amount catapulted and reached a whopping $202 billion, that’s according to the estimated report from the Pew Charitable Trusts. Suze Orman, a budgeting guru, is even marketing a prepaid card.
So to understand clearly why more and more consumers are opting to use debit cards than credit cards, Pew’s Safe Checking conducted a research in the Electronic Age project arranged focus groups last fall of 2012 in both Houston and Chicago.
The gist of the research shows that, more and more users do not like the heap of fees associated with prepaid cards, but still seem to prefer for it over the higher and, from their opinion, less highly unpredictable fees that goes along with the standard checking account.
Results of the research shows that, people seem to feel more comfortable on paying fees associated with their use of prepaid cards, which participants from Houston call is more transparent, to charges such as overdraft fees, which can get into the picture when using checking accounts at banks.
Many of the participants are also uncomfortable on the idea of adding credit options on their prepaid cards, since they are very satisfied with their cards as it help them stick to their budget and prevent them from overspending.