For anyone wondering if the purpose of small dollar loans in this country has waned, allow the last couple years and last week’s CDFI Fund news to be a stark reminder of their immense value and fundamental necessity for individuals and families’ financial recovery and overall financial health efforts.
As the COVID pandemic continues, believe it or not, and despite unemployment dropping to 3.5 percent as of July – a record low – many Americans are still feeling financial instability and distress with inflation continuing to be an expensive thorn in consumers’ sides. An August 2022 PYMTS survey found that 61 percent of American consumers were living paycheck-to-paycheck, up 55 percent from the year prior. In fact, 33.5 million Americans spent more than they earned in the past six months.
The challenges weren’t necessarily easier for consumers in the upper income brackets, either. The PYMTS study also found that the largest rise in paycheck-to-paycheck consumers were those earning $100,000 to $150,000, up 11 percentage points from May 2022 to 52 percent in June 2022. Such news emphasizes a stark reality that financial health and wellness in America does not necessarily stop at low-income individuals and communities.
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