Emergency Financial Lifelines at Risk of Disappearing in California
The Pacific Research Institute cites CEI on lenders and revenue generated from short-term loans.
While a $100 two-week loan does generate revenue — a mere $1.38 — lenders can actually lose nearly $13 on the transaction. Business operating and other expenses add up to $13.89, says the Competitive Enterprise Institute (CEI), leaving the lender $12.51 in the red. The economics make it impossible to loan money at 36 percent in the short-term and stay in business.