CUSTOMER DEMOGRAPHICS

Survey respondents possess the following demographical characteristics:

• 62% of respondents are females
• 62% of respondents have children under the age of 18 living at home
• Payday customers have an average age of 32
• Payday customers have a median income of $35,000
• 91% of respondents are high school graduates- 58% attended some college
• 21% are college graduates
• 50% rent their current dwelling
• 65% have lived in their current residence for three years or less
• 37% of respondents have held their current job for three years or more
• 51% of respondents said that they voted in the most recent general election
• 86% stated that they have family health insurance coverage

CUSTOMER MOTIVES FOR OBTAINING A CASH ADVANCE

• During the prior 12 month period, payday customers obtained these forms of credit:
  • Car loans (56%)
  • Home mortgages (33%)
  • Car title loans (14%)
  • Home equity loans (5%)

• 88% said that cash advance companies provide a useful service.
• 67% of cash advance loans were used to pay an unexpected expense [including a temporary reduction in income (18%)]
• Advanced payday loans were less frequently used for non-essential spending
• Aging of cash advance loans:
  • New advance (54%)
  • Rollover from an existing advance (40%)
    • Outstanding for 2 weeks or less (47% of these)
    • Outstanding for 3-4 weeks (27% of these)
    • Outstanding for more than 1 month (20% of these)
• 48% said they considered alternatives to payday loans:
  • Friends or relatives (40% of these)
  • Banks or savings and loans (34% of these)
• Primary reason for choosing a cash advance loan:
  • Convenience (49%)
    • Quick & easy (23% of these)
    • Convenient location (14% of these)
    • Faster (10% of these)
    • Involved less paperwork (2% of these)
    • No other credit alternative (12%)
• 54% said that the lack of collateral requirements influenced their selection of a cash advance
• Customer satisfaction with cash advance loans:
  • Satisfied (67%)
  • Neutral (23%)
  • Dissatisfied (10%)

CUSTOMER PERCEPTIONS OF VARIOUS BORROWING OPTIONS, INCLUDING CASH ADVANCES

• Respondents paid monthly credit card balance:
  • Almost always (14%)
  • Sometimes (15%)
  • Hardly ever 46%)
• 70% were turned down for other credit requests during the last five years.
• 68% wanted to apply for credit but did not for fear of being turned down.
• A majority believe that cash advance fees are less than or about the same as fees for:
  • Bouncing a check (59%)
  • Making late rent/mortgage payments (53%)
  • Making late credit card payments (54%)

Respondents were then asked their opinions of government intervention on aspects of the cash advance industry.

• Government should not:
  • Limit the number of cash advances a customer can receive each
    year (76%)
  • Make it harder to get cash advances by limiting the number of
    consecutive cash advances (76%)