A payday loan company helps people in times of urgent need, but as the global financial crisis continues to become more uncertain, there’s always a possibility the United States government will put restrictions on some types of lending that doesn’t require credit checks. If payday loans are outlawed, it could cut the go-to source for emergency cash. At worst, you could prepare yourself for such circumstances. Here are 5 worst-case scenarios you could face if payday loans are outlawed:
Appeal to Congress
While it is not likely consumers will stage a repeat of Occupy Wall Street, which did very little to change the financial system, it is probable that many people will write their Congressional representatives to express their need for immediate financial relief. You will need to address the fact that not all payday lenders take advantage of lower income people and many do help people in emergencies.
Lending Rules Will Tighten
Banks have already been under fire from the government for allowing questionable practices that led to the housing market crash. Although the Financial Reform Act of 2010 did tighten rules on conventional bank lending, continued economic uncertainty will possibly lead to stricter regulations on all types of loans, severely limiting access to borrowers with bad credit.
Consumers Will Learn to Conserve
Since nearly half of Americans are already experiencing financial troubles, they have already been primed for more tough times ahead. You will need to pay closer attention to your monthly budget and cut costs as much as possible. Without a payday loan company to turn to, this can reduce the amount of travel, vacations, and disposable entertainment spending.
People Will Be Forced to Be More Creative
A major consequence to stricter lending laws, perhaps on the positive side, will be that people will need to get more creative in the absence of money, especially for hobbies and gift giving. It may mean more people will turn to art, making their own clothes and recycling.
Payday Lenders Will Innovate
Even if new laws are enacted to restrict payday loans, those same lenders will find new ways to market different financial services.
Even as such worst-case scenarios loom large in the coming future, chances of greater number of people needing emergency cash can’t be overruled. Payday loan companies will need to brace themselves for huge demands. CashOne is a secure and professional payday loan lender you can trust in tough times.