I was doing a search for a specific keyword and I found that advertiser are paying for the search term "ten dollar payday loan". Not knowing what that was, I did a google search and I found something very interesting.
There are companies that advertise as being a guaranteed low-cost payday loan option, and they charge only $10 per $100 borrowed. They also proudly advertise their Annual APR as being ONLY 260.7%!.
Apparently there are companies that charge up to $30 per $100 borrowed, which is 3 times the APR, or over 750%!! Talk about gross margins! In any small business, you want to have the highest margins on your products. Getting several hundred percent is phenomenal.
You can get a small business loan for less than 15% in the current economic environment. If you can lend it out at 260-750%, you're sure to be profitable. Maybe I should start a check cashing or payday loan business myself!
Wednesday, July 2, 2008
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