First-Ever Survey of Payday Loan Consumers in Ontario - Conducted by Pollara

    Customers deliberately choose payday loan outlets over banks and credit
    unions for short-term borrowing

    TORONTO, Nov. 13 /CNW Telbec/ - The Canadian Payday Loan Association
(CPLA) today released the first statistically-relevant survey ever completed
of payday loan customers in Ontario. Canada's leading public opinion survey
company, Pollara, completed the survey of 503 payday loan customers from
August 22-September 14, 2007. The survey is accurate +/-4.4%, 19 times out of
    The survey clearly identifies the demographic profile of a payday loan
customer in Ontario, their specific attitudes and opinions about payday loans
and their other credit options. Previous to today's survey, the government,
industry and critics were left to guess or assume "who" a typical payday loan
customer is, "why" they use a payday loan instead of other credit options and
"what" they think of the payday loan product.
    "This groundbreaking survey tells us that payday loan customers in
Ontario deliberately choose this service over banks and credit unions," says
Stan Keyes, President, CPLA. "Customers are well educated and responsible
borrowers with many credit options who know exactly what they are doing and
what they are paying."
    "After years of surveys in the financial sector, I'm surprised by the
sophistication and knowledge of payday loan consumers," says Michael
Marzolini, Chairman of Pollara. "This data puts to rest a number of
widely-held misconceptions about the payday loan industry. For the first time,
we can talk about this industry's customers in terms that are real and
statistically-relevant. This research is important and should carry more
weight than the usual anecdotes, 'gut hunches' and speculation."
    "This survey will begin to put to rest inaccurate comments made about the
education, income, knowledge and reasons why people look to payday loans
instead of other forms of credit," added Keyes.
    Highlights of the surveys include:

    Demographics of Payday Loan Customers

    Contrary to conventional assumptions, the average payday loan customer is
employed, educated and is not representative of "low income" households.

    - The average payday loan customer is 39 years old
    - 68% of customers are currently employed full-time
    - More than half (51%) have completed post-secondary education
    - Overall household income reported for payday loan customers in Ontario
      tends to be on par with the Ontarian population. 43% of Ontarians
      report household income of less than $50k per year, compared to 42% of
      payday loan customers.

    Personal Credit Profile

    Although some have suggested people use payday loans because they have no
other option, the survey demonstrates that customers have access to a wide
variety of credit products, however still choose a payday loan for short-term,
small-sum borrowing.

    - Ontario payday loan customers owe an average of $23,579 to various
      financial institutions, excluding mortgages.
    - Customers have access to a variety of credit options, but choose a
      payday loan over a line of credit, credit card, retail card, overdraft
      or other forms of credit largely due to the "convenience" of the payday
      loan product, "ease of use" and "long hours of operation". Only 15% of
      customers indicated that they used a payday loan because they had "no
      other option".

    Borrowing Habits

    Customers borrow an average of only $350 when they visit a payday loan
outlet. Contrary to some critics that say that customers can't afford to repay
their loans, a large majority of customers say they have paid back every loan
they have ever taken on time.

    - The average payday loan taken out by a payday loan customer is $349.53,
      with almost two-thirds of borrowers (62%) borrowing less than $300.
    - Customers said they expect to pay an average of $23 for a $100 loan for
      two weeks.
    - 78% of customers have paid back all their payday loans on time, while
      another 17% have paid back "most" of their loans on time.

    Educated and Informed Consumers

    A major criticism levelled against the payday loan industry has been that
it "takes advantage" of people who don't really understand what they are
"getting themselves into". Customers rejected this notion and indicated they
are informed and deliberate borrowers with a very strong level of knowledge of
the terms and fees they pay for their loans.

    - Customers understand the costs and terms of their payday loan (61%).
      This is similar to their understanding of the fees and terms that they
      pay for bank fees (65%) and slightly less than what they pay for credit
      cards (72%) and their mortgage (72%).

    Payday Lenders vs. Banks and Credit Unions

    Payday loan customers are deliberate in their reasons for selecting payday
loan outlets over banks or credit unions for their short-term borrowing needs.
    Customers indicated that they preferred payday loan companies for their
overall convenience and ability to access small-sum loans, whereas banks and
credit unions will only extend loans for larger amounts.

    - Customers rate payday loan companies ahead of banks and credit unions
      in the areas of hours of operation, fast, convenient, easy to use,
      respectful and good service.
    - Payday loan companies tied banks on the criteria of being "respectful",
      and were rated behind banks on the criteria of "good value", but still
      rated almost three times higher than credit unions on the same

    Reasons for Needing a Payday Loan

    Customers indicated that they generally seek payday loans for emergency
situations or unexpected expenses. They often require only a small amount of
money to hold them over until their next payday and prefer to borrow a few
hundred dollars rather than getting more credit than they want with a credit
card or line of credit.

    - More than half of customers (59%) cite "emergency" or "unexpected"
      expenses as the principal reason for requiring a payday loan.
    - A further 20% said they took out a payday loan to avoid service charges
      on bills or bouncing cheques.
    - Only 5% of customers said they took out a payday loan to "buy
      something" they wanted.
    - Only 15% indicated they took out a payday loan because they had "no
      other option" - countering the popular notion that this is the primary
      reason for seeking a payday loan.

For further information:

For further information: Michael Marzolini, Chairman, Pollara, (416)
921-0090,; Stan Keyes, President of the Canadian Payday Loan
Association, (905) 645-4434,

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