The Payday Advance Market
The payday advance market is now entering the growth stage of the industry. In 2004, there were 22,000 active payday advance stores operating in the US. The market is expected to grow to 60,000 stores by 2010 which would represent market maturity.
The following chart illustrates the growth of payday advance stores since 2001. |
The Payday Advance Market |
From 2003 to 2004 there was a 16% increase in the amount of stores that were opened in the US. Since 1999 there has been year over year growth in this market which confirms the increasing demand for the payday advance industry.
The demographic for this market is primarily made up of people 18-55 years of age, have a household income of less than $50,000.00, have at least one child and live paycheck to paycheck.
Customers use the payday advance service to avoid excessive costs associated with having insufficient funds in their bank accounts or "bouncing" a check. The costs associated with "bouncing" a check can be as high as $70 after the bank and merchant penalties are assessed. The payday advance service provides a viable alternative to avoid these excessive penalty costs. |
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