Financial: Banking finance and capital market analysis

RUNNING Head: Financial: Banking finance and capital market analysis
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Financial: Banking finance and capital market analysis
Research Report

Financial: Banking finance and capital market analysis 1
Table of Contents
Introduction...........................................................................................................................................1
Objective of the report.......................................................................................................................1
Overview of the Cash Advance Lending...........................................................................................1
Risk and opportunity in the Payday loan market...................................................................................2
Analysis of Payday loan market in USA...............................................................................................2
Reflection on the pay day loan..............................................................................................................6
Conclusion.............................................................................................................................................7
References.............................................................................................................................................8
Appendix...............................................................................................................................................9

Financial: Banking finance and capital market analysis 2
Introduction
With the change s in economic, financial institutions and banks have been gaining
momentum in the financial capital market. The capital market of the Australia is highly
volatile and many investors are inclined towards raising funds from the Banks and financial
institutions. There are several ways of raising funds from the market such as bank loan,
overdraft, commercial paper and letter of credit. However, with the changes in time, easy
availability of funds is the prime concern for the investors. The pay day cash is one of the
method to raise funds from the market. In this report document, risk and return inherent in the
financial capital market has been analysed. After that contemporary issues impacting the
financial investment decision and sustainable financial market have been evaluated.
Objective of the report
The main purpose of this report is to analysis the Payday/ Cash advance lending
industry in Australia.
Purpose of the report
The main purpose is to analysis the risk and return inherent in Payday/ Cash advance
lending industry in Australia.
Overview of the Cash Advance Lending
Payday/ Cash advance lending is defined as process which could be used by person to
get the money in emergency if he cannot wait until the payday. With the high volatility in the
Australian capital market, many investors use this Payday/ Cash advance lending to grab the
investment opportunity and create value on their investment.
Payday/ Cash advance lending have been known as small loan market which is valued
approximately $ 400 million a year within 12 months (Robinson, & Schwartz, 2017).

Financial: Banking finance and capital market analysis 3
There are several ways which could be used by investors or other person to raise the
funds from as bank loan, overdraft, commercial paper and letter of credit. However, Payday/
Cash advance lending is the most desirable option to raise the funds within no time. In USA.
UK, Payday/ Cash advance lending has reflected average growth of 22% since last three year
which is remarkable achievement (Marston, Banks, & Zhang, 2017).
Risk and opportunity in the Payday loan market
Payday/ Cash advance lending is accompanied with the high complexity and paper
work. If borrower wants to raise funds from the Payday/ Cash advance lending market then
he firstly needs to write a personal check payable to lender for the amount of capital which he
wrote in the favour of company. After that, lender will lend the money to borrower subject to
the fees charged for the same. Nonetheless, Payday/ Cash advance lending provides easy and
fast availability to borrowers but the fees and amount charged for this is comparatively high.
In addition to this, if borrowers do not make repayment in time then the penalty charges and
other consequences are also high (Stegman, 2017).
Analysis of Payday loan market in USA
The Payday/ Cash advance lending amount is deducted or debited next payday. In
USA success of the Payday/ Cash advance lending is highly remarkable which have become
other venture investors to invest in this market in their respective countries. The success of
Payday/ Cash advance lending is USA has been taken as perfect support pillar for the
investors and borrowers to raise the funds from this mode. Small investors and other
companies have been using this Payday/ Cash advance lending to raise the funds instantly
and meet their requirements (Adeniyi, Whysall, & Brown, 2017).