According to the findings of a survey, about a third of all students have to depend on payday loans, credit cards, and overdrafts to fund their university education. Many of them were depending solely on cash loans. The Future Finance research discovered that as many as 31 percent of the students have to depend on these sources for covering their university expenses. The study was carried out among 1,000 full-time students.
63 Percent Students Taking Payday Loans Understand Financing Matters
Researchers also discovered, after talking to these students, that more than a quarter did not consider a payday loan to be a kind of debt, because of its short-term nature, and the small amount borrowed. Interestingly, 63 percent of the students who were questioned said they have good knowledge of finance, while the others conceded that their financial understanding could improve.
For instance, many of these students did not know what the Annual Percentage Rate or APR stood for. However, these students were a minority. Most of the researched students had a decent understanding of finance. Payday loan critics have often said that one reason why there is such a huge demand for these loans is because a big section of the population does not understand finance and how to manage money efficiently. That is clearly not the case, as evident with the findings of this research.