We see it in almost every town: blight.

It starts innocently enough, when the first payday lender opens up on the fast food strip on the outskirts of town. Then, it picks up momentum, when the second shop opens across the street.

Then downtown. Then across the street from that location. Then a rent-to-own furniture shop takes over the large former department store space. Then a pawn shop moves in.

Boom. Your downtown is now infested with predatory lenders.

They are making good money, providing loans to the poor, new immigrants, the folks with low financial literacy, and the desperate.

It’s sad to see, on a number of levels.

Because these predatory lenders are so very visible, they tend to brand a neighbourhood, effectively discouraging high customer-lifetime-value buyers (of any product or service) from visiting the area.

The next time you see a cluster of predatory lenders in an area, imagine replacing one of those storefronts with a trendy bistro, a nice clothing store, or even a Starbucks. There’s no doubt that the image improves immensely, motivated and qualified buyers come back to the area, and commerce gets a much-needed kick start.

Can this happen?

Of course it can, but it takes determination.

Our process starts with a compassionate understanding of the folks who live in the area, who are currently the customers of the predatory lenders. We ask:

Why are they using these services?
Do they know that alternatives exist?
Do they know the real cost of their decision?
What local services are available to increase financial literacy for the folks who use these services?
What kind of employment supports can we bring to bear, to either increase the number of jobs, or the number of hours worked?
Are there additional shelter services available?
Who would be interested and able to provide financial literacy training sessions?
Is there a local financial services provider who’d be interested in providing starter-bank accounts, so that we can help these folks enter the mainstream banking system?

There are more issues to resolve, but certainly, helping the folks who are stuck in the cycle of low income/high expense financing is a logical (and compassionate) place to start.

The next step is actually moving those predatory businesses out.

While that’s a difficult climb, it can be done, largely through a combination of helping the folks who are struggling, and by providing a sensible alternative that changes the market dynamics for the sector: ie, make the market less attractive do business in.

How?

We provide a web-based marketplace of personal loan providers to areas that are committed to renewal, and to creating a solution. By presenting this powerful multi-lender marketplace to the residents in the area, a few things happen:

Financial literacy improves: people realize that they can save money when lenders compete for their business.
They realize that they just don’t have to go to the same lenders that’ve been using in the past.
Those lenders begin to lose share, and eventually move out, hopefully to be replaced by a vibrant business that attracts high customer lifetime value to the area.