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The relevance of the article is due to the insignificant contribution of microfinance to the development of the Russian economic system, especially in the context of supporting small and medium-sized businesses. However, the regulator sees it as a promising sector of the financial market and considers its progressive development necessary. The purpose of the work is to study the current state and identify trends in the development of the microfinance market in Russia. The methodological basis of the study includes empirical observation and analysis. During the work, official statistical data and scientific publications on the topic of microfinance have been used. The article provides a review of current legislative documents regulating the microfinance sector, and analyses the state of the market based on statistical data. It is substantiated that some elements of the monetary and financial policies pursued in the Russian Federation can be applied for the successful development of the microfinance sector, contribute to its effective and balanced work, and improve accessibility and sustainability. In the course of the work, key directions for the development of the microfinance market are formed: improving regulation and supervision; promoting financial literacy of the population; application of digital technologies; expansion and diversification of the product portfolio, development of partnerships, social entrepreneurship, which contribute to the sustainable development of this segment of the financial market. Particular attention is paid to a detailed analysis of improving the regulatory framework for microfinance in Russia from the point of view of legislation on bankruptcy of individuals, stimulating innovation and digitalisation, and supporting social entrepreneurship.

Sixteen jurisdictions in the United States prohibit payday lending through stringent usury laws or well‐established nonprofitable 36% interest rate caps. Yet over one in 10 consumers residing in these jurisdictions borrowed payday loans in the past 5 years. This raises questions about actual policy implementation and enforcement. We employ data from the 2018 National Financial Capability Study to investigate if associations between payday lending prohibitions and payday borrowing differ by degree of enforcement. We find that nuances in degree of enforcement among restrictive states are not associated with payday borrowing likelihoods. However, these nuances appear when examining payday borrowing frequency, particularly when controlling for consumers' financial circumstances and when conditioning on alternative financial services consumers. We consistently note the highest borrowing behaviors for states sans regulation. Policymakers may consider strengthening enforcement in cases where the primary goal is preventing or reducing payday borrowing. [ABSTRACT FROM AUTHOR]

Federal regulators in 2010 amended lending rules to allow federal credit unions (FCU) to originate short‐term, small‐dollar amount loans, with an annual percentage rate of up to 1000 basis points above the otherwise imposed interest rate ceiling of 18 percent. The purpose of the change in policy was to allow FCUs the ability to provide their members with an alternative to payday loans. We find the decision to originate these higher‐interest loans is primarily influenced by the characteristics of a credit union's environment. Credit unions located in minority neighborhoods and in markets with fewer traditional financial services are more likely to participate in the payday alternative loan program. Participation in the program is shown to improve earnings performance without adversely affecting participants' loan quality. These results suggest credit unions can provide lower‐priced alternatives to payday loans that are beneficial to members and their credit unions. [ABSTRACT FROM AUTHOR]

'Buy now pay later' ('BNPL') has been described as 'an Australian fintech growth story', an innovative and disruptive financial product that has fundamentally changed the global market for consumer credit. Providers assert that BNPL promotes financial inclusion, allowing consumers to avoid the fees and interest associated with other, more expensive financial products. Yet critics maintain that BNPL is too readily accessible and that it can cause serious hardship, particularly for low income earners. This article is the first scholarly empirical study to focus on low income earners' use of BNPL. It draws on a series of focus groups with consumer advocates and an online survey of consumers who have used BNPL, either alone or in conjunction with payday loans or pawn loans. Drawing on this data, the authors evaluate the Commonwealth Government's current proposal to regulate BNPL more stringently, under the National Consumer Credit Protection Act 2009 (Cth). [ABSTRACT FROM AUTHOR]

The 2007 Military Lending Act attempted to ban high‐interest loans to U.S. military members and the 2017 "Final Rule" further restricted access, causing regional shocks in payday lending exposure in counties with a military base. Difference‐in‐differences and dynamic estimators provide mixed evidence on the effect of this payday lending access shock on regional economic outcomes and local business outcomes. However, we consistently find statistically significant reduced entry and exit of firms. Given payday lenders congregate around low‐income and minoritized populations analogously to how they congregated around military bases, these results provide policy implications for more general usury bans. [ABSTRACT FROM AUTHOR]

This article examines the impact of racial and socioeconomic inequalities on access to loans, mortgages, and credit in the banking and financial sector. It discusses the history of discriminatory practices in the banking system and the establishment of black-owned banks by African Americans. The article highlights ongoing disparities in banking, including the unequal distribution of benefits during the New Deal and the racial wealth gap. It concludes by exploring potential solutions to address these inequalities. The text also addresses the racial disparities in wealth and access to financial services in the United States, emphasizing the historical impact of slavery on the wealth gap. It discusses the lack of access to traditional banking services in marginalized communities and the reliance on alternative financial services. The economic costs of systemic racism are emphasized, and achieving racial and social equality is seen as crucial for economic development globally. The text highlights disparities in access to credit for African and black Americans, including differences in interest rates on business loans and the growth of local businesses in Black neighborhoods. Proposed solutions include improved banking supervision and support for minority depository institutions. The historical legacy of slavery has contributed to financial discrimination and exclusion for Black Americans, resulting in wealth disparities and limited access to quality healthcare and infrastructure. Closing the racial wealth gap is important for both black families and the broader U.S. economy. Black-owned banks have historically supported the economic well-being of Black communities, but face challenges in accessing capital and attracting investors. Identifying and addressing the factors contributing to the racial wealth gap is crucial for promoting economic equality. [Extracted from the article]

This study examines how individuals across income classes encountered payday lenders' appeals online and what their smartphone use reveals about their psychological reactions to these messages. We utilized novel Screenomics data, comprehensive sequences of screenshots (N = 13,498,584) collected every 5 seconds from the smartphones of lower-income and higher-income adults (N = 65) in U.S. metropolitan areas for 2 months. While examining a person's everyday smartphone use, we observed 103 natural exposures to advertisements of payday lenders who had in the past generated consumer complaints with the Consumer Financial Protection Bureau. We describe how individuals encountered payday loan ads through various digital channels despite the ad bans of major technology companies. We employed a quasi-experimental design to test for differences in participant actions immediately before and after ad exposure. Multilevel analysis results show that exposure to payday loan ads led to notable changes in the lower-income individuals' smartphone use. Directly after seeing the ads, the lower-income individuals engaged with content that contained fewer future-oriented words, switched between applications more frequently, and avoided content that evoked negative emotions. Such effects were especially pronounced among the lower-income individuals who lacked the support of social safety nets, such as the Supplemental Nutrition Assistance Program (formerly known as food stamps) and unemployment benefits. In contrast, there were no changes noted in smartphone use among the lower-income individuals receiving social safety net assistance and higher-income individuals. These findings highlight the nuanced yet impactful psychological consequences of digital experiences, an underexplored aspect of digital inequalities. [ABSTRACT FROM AUTHOR]

This paper extends recent theorising on “market violence”, defined here as a type of structural and cultural violence that takes place through an assemblage in the market environment. The Finnish “instant loan” market (similar to payday loans) has been widely criticised, e.g. for excessively high interest rates; in this paper, debtors’ anonymous narratives on the discussion forum Suomi24 are used to analyse the instant loan market as a case of market violence. The study contributes to a deeper understanding of the role of culture and affect in market violence and presents a model of cultural market violence showing how affects (here: hope, shame, despair and sense of urgency) can play a key role in mediating between cultural ideals (here: those of individual responsibility and the “good life”) and concrete business practices, thus enabling market violence. [ABSTRACT FROM AUTHOR]

Fintech is actively expanding its activities in various directions in the modern financial system. One of these directions is the development of consumer lending, which forms an important competitive factor for banks and other traditional lenders. Lending models implemented by fintech companies have a number of fundamental differences from classic ones. The article is devoted to the study of the fintech microcredit model and the profitability analysis of this model based on the advanced Whale curve toolkit adapted to lending. In the article, the microcredit model is structured into three blocks, which include income generation, credit risk management systems, and borrower lead generation. Income generation is considered within the PDL (payday lending) approach. The methodological components of the application of the Whale curve toolkit for lending are justified. The first component outlines a holistic visualization of the relationship between risk and profitability of the credit portfolio of microcredit. The second component is the use of two approaches to the application of the Whale curve toolkit. The first approach is based on the choice of the basis of analysis of income from borrowers, and the second – on the choice of the basis of analysis of income from loans issued. The third component of the methodology was the segmentation of the loan portfolio into 4 segments: A, B, C, and D. It was done for both approaches. Segment A is characterized by the generation of high profitability for the creditor, segment B is close to a neutral level of profitability, and segments C and D are defined by a negative financial result of different levels. The analysis, based on the developed methodology, made it possible to identify a number of regularities between risk and profitability both in terms of segments A, B, C, and D and in terms of repeated loans. The analysis was conducted on the basis of data from several Ukrainian fintech companies for the 2nd and 3rd quarters of 2021. Within the methodological components, the analysis of income sensitivity based on the scenario approach was used in the work. A number of scenarios regarding changes in credit characteristics and risk management parameters were formed. On this basis, the sensitivity of income to these changes was modeled, and a comparative analysis of the results was carried out. The methodology proposed in the article makes it possible to implement an optimization analysis of fintech microcredit, to determine the relationship between credit risk and profitability, and to choose the optimal strategy for increasing the profitability of lending.

Purpose: This study aims to explore stigma in payday borrowing by investigating how the stigma associated with using such a service may spill over and affect other people, entities and relationships beyond the user within a service ecosystem. Design/methodology/approach: In-depth interviews exploring consumers' lived experiences and stigma were combined with publicly available reports from key stakeholders within the payday loan (PDL) industry to create a qualitative, text-based data set. The transcripts and reports were then analysed following thematic protocols. Findings: Analysis reveals that the stigma associated with using a stigmatised service spills over, affecting not only the borrower but other actors within the service ecosystem. The analysis uncovers three important interactions that spilled over between the actors within the stigmatised service ecosystem (SSE), which can be damaging, enabling or concealed. Research limitations/implications: This study introduces and explores the concept of "SSEs" and investigates the impact of stigma beyond the dyadic relationships between service providers and users to consider the actors within the wider ecosystem. The findings reframe existing understandings about stigma, as this study finds that stigmatised services can play both a positive (enabling) and a negative (damaging) role within an ecosystem, and this study uncovers the role of stigma concealments and how they can affect relationships and value co-creation among different actors. Practical implications: This study provides evidence for more robust policies for addressing stigma in different SSEs by mapping the effects of stigma spillover and its effects on the borrower and other actors. Originality/value: This study contributes to reframing marketing priorities by extending existing work on consumer stigma by showing how the stigma of a PDL may spill over and affect other actors within a service ecosystem. Significantly, the interactions between the actors may have positive as well as negative outcomes. [ABSTRACT FROM AUTHOR]

We augment a standard dynamic general equilibrium model with financial frictions, in order to quantify the macroeconomic effects of the credit deepening process observed in Latin America in the 2000s—most notably in Brazil. In the model, a stylized banking sector intermediates credit from patient households to impatient households and entrepreneurs. Motivated by the Brazilian experience, we allow the credit constraint faced by households to depend on labor income. Our model is designed to isolate the effects of credit deepening through demand‐side channels, and abstracts from potential effects of credit supply on total factor productivity. In the calibrated model, credit deepening generates only modest above‐trend growth in consumption, investment, and GDP. Since Brazil has experienced one of the most intense credit deepening processes in Latin America, we argue the quantitative effects that hinge on the channels captured by the model are unlikely to be sizable elsewhere in Latin America. [ABSTRACT FROM AUTHOR]

In the past 3 decades, there has been a general contraction of social support while the high-cost lending industry has expanded. We examine how state-level variation in the generosity of Temporary Assistance for Needy Families (TANF) cash assistance affects the distribution of high-cost payday lenders across local communities between 2001 and 2017. When TANF support is relatively more generous, the density of payday lending storefronts increases in local communities, all else equal, suggesting that benefits are not enough to replace payday lending demand. Yet local communities also experience slower lender growth as TANF generosity increases, suggesting that the payday lending industry is less growth oriented under these conditions. Further analyses considering the Supplemental Nutrition Assistance Program and unemployment insurance confirm that the payday lending industry is sensitive to social program conditions. Findings suggest that the generosity of cash assistance can be leveraged to reduce the high-cost lending industry's prevalence. [ABSTRACT FROM AUTHOR]

This paper examines how minimum wages affect lender and borrower interactions with consumer credit markets. We find that higher state minimum wages increase the supply of unsecured credit, reduce payday loan usage, decrease delinquency, and increase credit scores. Overall, minimum wages reduce borrowing costs and have positive spillover effects on disposable income and liquidity. A back-of-the-envelope of the cost savings indicates that higher minimum wages increase disposable income by 1.3% more than implied by estimates of the direct effect on earnings. [ABSTRACT FROM AUTHOR]

Business actors often act in ways that may harm other parties. While the law aims to restrict harmful behavior and to provide remedies, legal systems do not anticipate all contingencies and legal regulations are not always well-enforced. This article argues that the logic of double effect (LDE), which has been developed and deployed in other areas of practical ethics, can be useful in helping business actors decide whether or not to pursue potentially harmful activities in commonplace business activity. The article illustrates how LDE helps to explain the exploitative nature of payday lending, the distinction between permissible and impermissible forms of market competition, and the potential wrong of imposing risk of harm on others. The article also addresses foundational debates about LDE itself. We offer the article as an illustration of the sort of "midlevel" theorizing that can address directly the needs of practitioners. [ABSTRACT FROM AUTHOR]

This study provides theory and evidence on the relation between financial literacy overconfidence (FLO) and high-cost borrowing and its mediation and moderation through mobile financial services (MFS). We investigate whether MFS carry the effect of FLO on the household demand for alternative financial services (AFS), such as payday loans. Using the 2018 National Financial Capability Study, we show that using MFS both mediates and moderates the effect of FLO on the use of AFS. We find that unbanked households, who make up around 5% of the sample, are twice as likely to take out payday loans and three times as likely to use AFS than households with access to the banking system. Estimates show that 4% of the total effect of FLO on using AFS and taking out payday loans is mediated by using MFS. We find that households who use MFS are two to three times more likely to access AFS and take out payday loans than those who do not use MFS. [ABSTRACT FROM AUTHOR]

The payday lending industry has been characterized as predatory, which has led to tougher government interventions. However, research on how stricter consumer protection regulations affect actual vulnerable consumers' lived experiences remains seriously underdeveloped. Following in‐depth interviews with financially excluded and therefore vulnerable payday loan consumers, this study finds that increased payday loan industry regulations are perceived by consumers as either empowering, disempowering, or simultaneously (dis)empowering. Accordingly, practical implications are developed to help public policy makers navigate vulnerable consumers' ambivalent relationship with consumer protection regulations. [ABSTRACT FROM AUTHOR]

Background: Bristol City Council introduced a new advertisement policy in 2021/2022 which included prohibiting the advertising of unhealthy food and drink (HFSS), alcohol, gambling and payday loans across council-owned advertising spaces. This mixed methods study is part of the BEAR study, and aimed to explore the rationale and the barriers and facilitators to implementing the policy, and describe the perceived advertising environment prior to implementation. Methods: Semi-structured interviews were carried out with seven stakeholders involved in the design and implementation of the advertising policy. A stakeholder topic guide was developed before interviews took place to help standardise the lines of inquiry between interviewees. A resident survey was developed to collect socio-demographic data and, for the purpose of this study, information regarding observations of advertising for HFSS products, alcohol and gambling. Results: Fifty-eight percent of respondents residing in Bristol and South Gloucestershire reported seeing advertisements for unhealthy commodities in the week prior to completing the survey. This was highest for HFSS products (40%). 16% of residents reported seeing HFSS product advertisements specifically appealing to children. For HFSS products in particular, younger people were more likely to report seeing adverts than older people, as were those who were from more deprived areas. An advertisement policy that restricts the advertisement of such unhealthy commodities, and in particular for HFSS products, has the potential to reduce health inequalities. This rationale directly influenced the development of the advertisement policy in Bristol. Implementation of the policy benefitted from an existing supportive environment following the 'health in all policies' initiative and a focus on reducing health inequalities across the city. Conclusions: Unhealthy product advertisements, particularly for unhealthy food and drinks, were observed more by younger people and those living in more deprived areas. Policies that specifically restrict such advertisements, therefore, have the potential to reduce health inequalities, as was the hope when this policy was developed. Future evaluation of the policy will provide evidence of any public health impact. [ABSTRACT FROM AUTHOR]

This research used the theory of planned behavior as a framework to investigate the role of attitudes, behavioral control, norms, and previous behavior in payday loan borrowers' difficulty or lack of difficulty in repaying loans. The data were collected from 138 respondents with payday loan experience via a questionnaire in a city in a western province in Canada as part of a campaign to change payday loan regulations. The research findings show that different approaches are necessary to address the needs of distinct types of payday borrowers, based on their repayment abilities and whether the loan improved their quality of life in the long term. Furthermore, we found, similar to previous literature, a group of payday borrowers who lack financial confidence. This sub-group is referred to as the "unsure" sub-group in our research and provides opportunities to improve the payday learning context. To accommodate the unsure group, payday lenders and conventional financial institutions can collaborate to offer innovative financial instruments, improve financial literacy through education, and provide better access to information about borrowers' financial status. The confirmation of this unsure group also leads us to recommend further study to determine opportunities for payday borrowers to become better informed about their options, to increase financial confidence. [ABSTRACT FROM AUTHOR]

We test the ability of the Decoy Effect to enhance debt collection efforts and find that by disclosing the Annual Percentage Rate (APR) in settlement offers, participants are less influenced by the decoy and more apt to select the repayment option that is in their best interest. At the same time, by reporting the APR, borrowers are more willing to make repayments on the modified loan, resulting in a net gain to debt collection efforts. Because disclosing the APR is Consumer Financial Protection Bureau (CFPB) compliant, this simple disclosure has the ability to increase debt collection returns while helping borrowers make better decisions when selecting debt modification repayment plans. Our results suggest an applicability to all types of defaulted debt including mortgages, sub-prime auto loans, credit cards, student loans, and payday loans. [ABSTRACT FROM AUTHOR]

High-cost loans, including high-interest installment loans as well as small, high-cost payday loans, are common in Canada and, as we show, have become much more common than they once were. The lenders are private firms and are not required to report on the volume of their loans or on the characteristics of their borrowers. Data associated with bankruptcy filings, however, allow us to estimate how many high-cost loans appear among the liabilities of those filing for personal bankruptcy and how that number changed between 2011 and 2019. We find that the number has roughly tripled, even though the number of bankruptcies remained roughly constant. We also provide an examination of the situation in Quebec, which, alone among the provinces, does not have legislation specifically aimed at payday lenders. [ABSTRACT FROM AUTHOR]

Payday loans are controversial high-cost, short-term lending products, banned in many U.S. states. But debates surrounding their benefits to consumers continue. We analyze the effects of payday loans on consumers by using a unique data set including 99% of loans approved in the United Kingdom over a two-year period matched to credit files. Using a regression discontinuity research design, our results show that payday loans provide short-lived liquidity gains and encourage consumers to take on additional credit. However, in the following months, payday loans cause persistent increases in defaults and cause consumers to exceed their bank overdraft limits. Received August 1, 2017; editorial decision June 30, 2018 by Editor Philip Strahan. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online. [ABSTRACT FROM AUTHOR]

In this paper we analyse a recent debate on justification of usury regulations and their implications. To investigate the impact of liberal, competition-enhancing policy on usurious practices, we present a case study of the Polish payday loan market after 2008. We also examine the efficacy of usury regulations in Poland. Our study finds that consumer welfare, social welfare, and the risk of exploitation of borrowers are the main arguments for introducing interest caps. We demonstrate that, in pursuit of greater profits, loan companies use additional non-interest fees and commissions as well as bundling, and thereby reduce the transparency of loan agreements. We show that rising competition on the payday loan market is not sufficient to reduce the cost of loans, especially when the efficacy of regulatory control is deficient and unsatisfactory. Therefore, the efficacy of the judicial system can be seen as essential to combat usurious lending.

Governments regulate debt collectors to protect consumers from predatory practices. These restrictions may lower repayment, reducing the supply of mainstream credit and increasing demand for alternative credit. Using individual credit record data and a difference‐in‐differences design comparing consumers in states that tighten restrictions on debt collection to those in neighboring states that do not, I find that restricting collections reduces access to mainstream credit and increases payday borrowing. These findings provide new evidence of substitution between alternative and mainstream credit and point to a trade‐off between shielding consumers from certain collection practices and pushing them into higher cost payday lending markets. [ABSTRACT FROM AUTHOR]

Banks have financially supported payday lenders for decades. In this article I qualitatively demonstrate how these financial relationships have reinforced and expanded a bifurcated consumer credit market, and why these relationships matter for consumer access to financial services. I use archival financial documents from publicly traded payday lending companies between 1996 and 2014, available through the Securities and Exchange Commission, to construct the bank‐payday lender network and reveal motivations for these financial relationships. I find that bank‐payday lender relationships are sustained over many years, and that these relationships are mutually beneficial, enabling payday lender expansion and providing a way for banks to quietly profit from high‐interest lending in the face of other regulatory constraints. Further, I show that these relationships have significantly reshaped the consumer credit market over the past two decades. I conclude by considering broader implications of symbiotic institutional relationships in contemporary markets. [ABSTRACT FROM AUTHOR]

Fintech is actively expanding its activities in various directions in the modern financial system. One of these directions is the development of consumer lending, which forms an important competitive factor for banks and other traditional lenders. Lending models implemented by fintech companies have a number of fundamental differences from classic ones. The article is devoted to the study of the fintech microcredit model and the profitability analysis of this model based on the advanced Whale curve toolkit adapted to lending. In the article, the microcredit model is structured into three blocks, which include income generation, credit risk management systems, and borrower lead generation. Income generation is considered within the PDL (payday lending) approach. The methodological components of the application of the Whale curve toolkit for lending are justified. The first component outlines a holistic visualization of the relationship between risk and profitability of the credit portfolio of microcredit. The second component is the use of two approaches to the application of the Whale curve toolkit. The first approach is based on the choice of the basis of analysis of income from borrowers, and the second - on the choice of the basis of analysis of income from loans issued. The third component of the methodology was the segmentation of the loan portfolio into 4 segments: A, B, C, and D. It was done for both approaches. Segment A is characterized by the generation of high profitability for the creditor, segment B is close to a neutral level of profitability, and segments C and D are defined by a negative financial result of different levels. The analysis, based on the developed methodology, made it possible to identify a number of regularities between risk and profitability both in terms of segments A, B, C, and D and in terms of repeated loans. The analysis was conducted on the basis of data from several Ukrainian fintech companies for the 2nd and 3rd quarters of 2021. Within the methodological components, the analysis of income sensitivity based on the scenario approach was used in the work. A number of scenarios regarding changes in credit characteristics and risk management parameters were formed. On this basis, the sensitivity of income to these changes was modeled, and a comparative analysis of the results was carried out. The methodology proposed in the article makes it possible to implement an optimization analysis of fintech microcredit, to determine the relationship between credit risk and profitability, and to choose the optimal strategy for increasing the profitability of lending. [ABSTRACT FROM AUTHOR]

In response to the Covid-19 pandemic, the US federal government distributed US$800 billion in Paycheck Protection Program (PPP) loans to small businesses to preserve employment. Since PPP funding was transmitted through private banks, the characteristics of the regional banking market may have unevenly affected the programme's reach. This paper examines how variations in market concentration and the presence of community banks contributed to PPP disbursement in US counties. It finds that greater regional banking market concentration correlates with fewer PPP loans, but this negative relationship is mitigated by a greater presence of community banks in highly concentrated markets. [ABSTRACT FROM AUTHOR]

Regulation of small‐dollar lending in the United States is heterogeneous, leaving open the question about what policy designs work best for protecting consumers. We compare the effectiveness of regulations that include a consumer eligibility component and regulations that apply to all consumers, centering our analyses on communities with disproportionate exposure to high‐interest lending storefronts. Specifically, we compare how the Military Lending Act (MLA), which provided military‐specific protections, and statewide policies affected high‐cost lender activity in military communities in three states. We find that statewide regulations were effective in reducing the number of high‐cost lenders within local communities across states, including military communities, while the MLA had no impact on the number of lenders around military bases. Our findings have implications for how to regulate small‐dollar lending and protect consumers at increased risk of exposure to high‐cost lending, with specific attention to product alternatives and access to low‐cost financial services. [ABSTRACT FROM AUTHOR]

The modern credit market is actively changing under the influence of digitalization processes. Some of the drivers of these changes are financial companies that carry out, among other things, online lending. Online lending is objectively focused on short-term small loans, both payday loans (PDL) and short-term loans for SMEs. In our research, we applied a special segmentation of borrowers based on the whale-curve approach. Such segmentation leads to four segments of borrowers (A, B, C, and D) which are characterized by the specific features of profitability, risk, recurrent loan granting, and others. The model of optimal correspondence between "risk–return-marketing efforts" is elaborated in the mentioned segments. Marketing efforts are considered in the context of the optimization of the marketing-budget allocation. Our approach was essentially grounded in special scoring-tools that allow multi-layer assessment. A scheme of assessment of profitability, risk, and marketing-resources allocation for borrower's inflow is constructed. The results can be applied to the customer relationship management (CRM) of online non-banking lenders. [ABSTRACT FROM AUTHOR]

Payday loans are one of the most controversial alternative financial services due to their staggeringly high interest rates and the potential for users to become heavily indebted. Findings regarding the relationship between payday loan use (PLU) and financial well-being are mixed and inconclusive. As the pervasive use of payday loans continues, empirical knowledge remains limited regarding how PLU affects daily money management and long-term financial outcomes among U.S. households. Using a nationally-representative sample, the current study investigates the relationship between PLU and household financial well-being. A propensity score matching analytical approach was used to address selection bias. Results suggest that PLU can be harmful to daily money management such as paying bills and making ends meet, but also serves as a cash flow alternative on which households rely to cope with emergencies. Findings indicate a complex relationship between use of payday loans and financial security, calling for more nuanced investigations focused on the impacts of the fringe economy on family well-being. [ABSTRACT FROM AUTHOR]

Regulated small‐dollar installment lenders do not operate within Arkansas, but they do in all six states that border Arkansas. We can measure the effects of Arkansas' 17% interest rate cap because Arkansas residents obtain installment loans only from out‐of‐state lenders. On average, Arkansas residents borrow $1051 at an annual percentage rate of 93%, when incorporating travel costs. Arkansas residents borrow at a rate of 90.4 loans per 10,000 people, compared to 524.5 per 10,000 for residents of the six bordering states. Residents in Arkansas counties that border other states hold 96.7% of out‐of‐state‐supplied small‐dollar installment loans. Statistical tests confirm that the interest rate cap affects residents in the interior counties of Arkansas more than it does residents in the perimeter counties. [ABSTRACT FROM AUTHOR]