For employees to be more present and productive at work, they need to be free from the stress and health implications that stem from financial precarity. Seventy-five percent of Americans rank finances as their primary source of worry. Unfortunately, this trend has only become exacerbated by the onset of the Coronavirus pandemic and the socioeconomic shockwave that continues to follow.
Are you prioritizing your employees’ financial health? Because people are financially strapped, they may not have access to the right resources and programs to support them. Learn how safe lending is an essential resource to aid your employees’ financial and physical well-being.
Predatory lending is considered “any lending practice that imposes unfair or abusive loan terms on a borrower.” Targeting those in desperate situations, lenders manipulate borrowers into agreeing to faulty lending terms. Predatory lending lacks both transparency and a valid cost-benefit analysis. Ultimately, it can leave your employees paying far more than the initial cost of the loan.
Payday loans are typically predatory in nature. At face value, payday loans appear to be a foolproof get-cash-quick loan. These loans are for smaller amounts of cash and must be paid back on the borrower’s upcoming payday. However, these short-term loans have even shorter-term benefits. Often lacking comprehensive repayment plans, these loans can snowball, often costing more than the loan themselves. If your employee is utilizing a payday loan, they could be paying a large annual percentage rate (APR). Most payday lenders offer APRs up to 400%, and while workers don’t want to resort to these options, sometimes it’s their only solution. Fortunately, there are practices in place that assist your employees in navigating the realm of loans to avoid the emotional and economic cost of unreliable lending.
When a borrower, such as your employee, has control of their money and can pay back a loan in regular installments under fair and reasonable terms, it is considered safe lending. Through this process, a comprehensive approach is taken to the loan. Both the trustworthiness of the lender and creditworthiness of the borrower are essential to seal the deal. When all of this is considered, not only can the lender feel confident in their investment of money, but also the borrower can feel assisted by the loan and able to repay it in time. This sense of security is essential in providing safety in the lending process and relieving stress for both parties.
Americans stress primarily about money. From those surveyed, more than half of the workers WorkLife supported this year said they would be unable to afford an emergency expense of $300 or more. This type of chronic stress not only affects mental health but can also have a profound impact on a person’s physical health. High stress is linked to stomach issues, blood pressure problems, heart complications, and more. These issues only increase medical bills and further debt. Are you able to avoid having these ailments affect your employees?
For employees to do their best, they must feel their best. The root of company success lies with the mental and physical health of its employees. At WorkLife Partnership, our Small Dollar Loan Program gives employees access to safe lending so they can maintain financial stability, relieve stress, and be more productive at work.
WorkLife Partnership offers a Small Dollar Loans Program paid back through payroll deductions so Colorado employers can make financial health a priority for their workers. This program is a cost-effective, low-risk alternative to payroll advances and employee loan programs. Below are some benefits that our program provides:
Ninety-eight percent of employees we surveyed say that having access to our small dollar loans program makes them more likely to stay at their current employer. Contact us today if you think WorkLife’s Small Dollar Loans program may be a good fit for your employees and your business.