Payday loan companies like Cash Store have faced an excellent deal of legal opposition in their quest to provide cash til payday loans for consumers. Much of the flak is really coming from consumer interest groups with lobbyist connections to elected officials. They claim to represent the best interests of consumers in their opposition to such outlets as CEO Gordon Reykdal’s Cash Store. If payday cash loans were so damaging, it would seem logical that they’d avoid the product. Yet a recent The Globe and Mail article says that Reykdal and Cash Store Financial are a popular choice in Canada and abroad.
Cash Store has about 34 percent of market share on paycheck loans in Canada
For CEOs, typically the connection with day-to-day business decisions at such places as Cash Store would be minimal. However, Cash Store Financial CEO Gordon Reykdal is far from uninvolved. He doesn’t let underlings make all the tough decisions. On the contrary, Reykdal is heavily invested in Cash Store; he owns a quarter of the stock, as outlined by The Globe and Mail. Not only has Reykdal ensured that Cash Store Financial would play an active role in the community (as shown in video below), he played an active role in urging the Canadian government to clarify the laws regarding extra cash loans and just how payday loan companies can offer them. His efforts have helped numerous payday lender and the government find a workable middle ground where consumers and lenders can still benefit from reasonably profitable lending transactions without the threat of exploitation. The rules will continue to apply in every Canadian province except Quebec, where easy cash loans loans are prohibited.
Growth into other services for many of the underbanked
Cash Store understands that a significant percentage of Canada’s population is effectively “underbanked.” Much like within the United States, numerous people do not have the credit standing to take advantage of small bank loans or are outside the traditional banking system for a variety of reasons. That’s why Gordon Reykdal wants to see Cash Store Financial branch out into the field of banking services for its large customer base. Simple services, like taking deposits, go a long way toward improving a consumer’s financial portfolio in situations where they either do not trust traditional banks or encounter barriers that prevent them from using traditional banks. In the fragmented payday cash loans environment, Cash Store has a responsibility to its customer base to serve their financial needs when traditional banks refuse to do so.
Globe and Mail – Cash store is good investment
Payday cash loans and related laws have become clearer with time. Canada and the UK have come to workable solutions that have made happy both the industry and lawmakers. The US has yet to discover a middle ground such as this. One result of this might be that consumers already harmed by the recession continue to find it difficult to obtain credit when they experience financial need.
Citations
The Globe and Mail
theglobeandmail.com/globe-investor/investment-ideas/features/vox/cash-store-lends-credibility-to-payday-loan-industry/article1612297/
