Ault, Holly Keyes
Danish Consumer Council
Our project goal was to propose initiatives for the Danish Consumer Council which would protect consumers from excessive indebtedness. Payday loans are short term, high interest loans which are intended for emergency expenses. These loans can trap consumers in a cycle of debt if not paid off on time. We found that the three major reasons for payday loan indebtedness are: consumers are trapped in a cycle of debt, payday lenders are running a delinquency intensive business, and payday loan advertisements are targeting impulsive consumers. To address these three problems, we proposed a multi-pronged solution consisting of four initiatives: a credit database, advertising limits, 48-hour cool-off, and a charge cap. We also recommend requiring lenders to disclose more loan usage information.
Worcester Polytechnic Institute
Interactive Qualifying Project
All authors have granted to WPI a nonexclusive royalty-free license to distribute copies of the work, subject to other agreements. Copyright is held by the author or authors, with all rights reserved, unless otherwise noted.