Cashboy Payday Loan

Opportunity

Problem

The Global Payday loans market size was valued at $32.48 billion in 2020 and is projected to reach $48,68 billion by 2030, growing at a CAGR of 4.2% from 2021 to 2030. A payday loan is a short-term unsecured loan, often characterised by high-interest rates. This allows the borrower to write a post-dated check to the lender for the payday salary but receives part of that payday sum in immediate cash from the lender.

Fig 1:  Allied Market Research: Cash Cowboy Payday Loan 

Forecast Period:  2021 To 2028

The global payday loans market is expected to witness significant growth over the forecast period. The increasing awareness about payday loans among the young generation and the aggressive adoption of the latest, advanced technologies by payday lenders are anticipated to drive the growth of the market over the forecast period.

Payday loans, which are also called check advance loans or cash advance loans, envisage a type of short-term borrowing, whereby payday lenders offer immediate short-term credit at very high-interest rates. The working principle behind payday loans is typically based on the portion of the customer’s next paycheck, and the interest rates are often based on the customer’s income. A payday loan allows borrowers to issue a post-dated check for the payday salary to the payday lender and receive part of that payday amount in immediate cash from the payday lender.

Getting a payday loan is easy as the eligibility requirements for obtaining payday loans are very limited. For instance, the borrower must be 18 years old or above, must be employed, and must possess a driver’s license and a bank account. These limited requirements make a large number of customers eligible for a payday loan approval. The growing awareness about payday loans and the rapid payday loan approvals without any restrictions on usage are expected to drive the growth of the global market over the forecast period.

Solution

The tremendous growth in the demand for very small, short-term loans by credit-constrained households is being largely filled by companies offering payday loans.

A payday loan is a short-term loan with high fees that make it a very expensive way to borrow money. Up to $1,500 can be borrowed. The loan must be paid back from the borrower’s next paycheque.

Payday loans are very expensive compared to other ways of borrowing money.

This is because:

• Fees are high
• The cost may be equivalent to an interest rate of 500-600%
• If a borrower’s check or pre-authorized debit doesn’t go through, a fee may have to be paid.

These high costs can make the loan harder to pay back, which can increase financial difficulties and stress for the borrower.

Before taking out a payday loan, it is important to make very sure that it can be paid back on time. If not, the lender’s financial situation may get worse. The borrower’s debt can keep growing and can end up paying a lot of money over time.

Payday loans are meant to cover a cash shortfall until your next pay or for a short period. It is advisable to avoid using payday loans for ongoing costs such as rent, groceries, or utility bills. If lenders use them in this way, they may end up in financial trouble

Market

Payday Loans Market Segmentation

The increasing awareness about the payday loan among the youth population is expected to fuel the growth of the Payday Loans Market during the forecast period 2021 – 2030. Payday loans are becoming more popular among young people, who are facing greater financial insecurity than prior generations. Furthermore, one-third of all people between the ages of 25 and 34 are expected to have a student loan, which will be Generation Z’s largest source of debt. 

This forces individuals to apply for payday loans to obtain quick and cheap cash, fueling the market’s growth. Payday lenders have begun to target young people with appealing digital marketing.

Additionally, according to the Citizens Advice Bureau in Canada, up to 4 out of 10 young adults will utilize a payday loan at some point in their lives. Furthermore, as the cost of living rises around the world, students with college loans are under increasing pressure to repay their obligations, and many young people are turning to the online payday loans industry, which is fuelling the market’s growth.

The payday loan industry in Canada has grown rapidly to an estimated 1,400 retail outlets across the country; with nearly two million Canadians a year making use of payday loans.

By researching the market thoroughly, we can minimize the risk to our business; identify new opportunities, while helping us to communicate better with our customers.

We identify our market’s key demographic, geographic, psychographic, and behaviouristic characteristics, as follows :-.

• Demographic: age, gender, Income, Education, Ethnicity, Family size
• Geographic:  region, city, neighbourhood
• Psychographic:  Social class, lifestyle, personality, values, life stage
• Behaviouristic:  buying pattern, consumption, loyalty, attitude

Roadmap

Our roadmap will ensure we take a good look at all aspects of the business requirements. This will result in a strategic tool that will serve as a guide for better and more effective management. It will help us to identify opportunities and challenges and will also focus our attention on important questions to be tackled.

The roadmap for the business can be summarized as follows:

1. To become the payday loan platform of choice in Ontario, British Columbia, and Alberta. 

2.    To make online loans as hassle-free as possible.

3. Provide exceptional service and product that leaves an impression.

The keys to success in achieving our goals are:

• Vision, strategy, and goals.
• Setting revenue and profitability targets and following strict financial controls.
• Managing our internal finances and cash flow to enable upward capital growth.
• Having a comprehensive, worthwhile inventory offering to meet borrowers’ demands and interests.
• Online Sales Tools to facilitate seamless borrower interaction and sales.
• Listening to our borrowers’ feedback and adapting to maximize their satisfaction levels and build trust and brand loyalty.
• Consistent product quality. 

Company Overview

Cash Cowboy Payday Loan is an online payday loan company that provides online payday loan services to residents in both BC and Ontario. Our application process is much easier compared to other payday loan companies. Our service is fast and reliable. We lend to those who need a short-term financial solution, without the burdensome and impossible requirements of many large banks and other financial institutions. Our goal is to achieve full automation of the management and approval process.

Our mission is to ensure that our customers get the service they deserve and the funds they need timeously anywhere in Canada, to help them get their finances back on track.

Dawson Chen started the company in March 2022.  He is a young, dynamic leader who is rich in industry experience. Dawson is curious and exploratory about digital development.

With considerable experience in investment, real estate, and the service industry, Dawson Chen believes that his vast experience has prepared him for an online loan platform. His background in Eastern and Western cultures, multilingual ability, and having graduated from top Western universities, has made him a good thinker in completing an order of magnitude change with minimal cost.