Former Google Exec Sees Payday in ZestCash

By DailyFinance ( DailyFinance ) -- A former Google executive has moved from the world of Internet searches to the world of high-interest, short-term lending. He says his operation, ZestCash.com, offers an innovative way to help the poorest borrowers avoid financial emergencies. But is this just a slick veneer putting a shine on the classic payday lending business?

chief information officer Douglas Merrill founded online-only lender ZestCash, which uses some fairly high-level Google-esque algorithms to assess its borrowers' creditworthiness. And the site certainly looks better than your typical payday lender. Those sketchy outfits usually operate out of rundown storefronts in lower-income neighborhoods, offering quick cash infusions at jacked-up interest rates to people with nowhere else to turn. But friendly looking ZestCash does essentially the same thing: Its loans ring up at triple-digit interest rates. For example, a three-month $800 loan will cost nearly $550 in interest and fees at the 412% interest rate that ZestCash charges. The site is one of a number of new businesses popping up to cater to a growing segment of Americans: The poor and credit-challenged who don't -- or can't -- use a bank. As high unemployment and falling wages continue to push more Americans into poverty, financial innovators like Merrill are on the lookout for new ways to milk profits out of this demographic. Firmly on the 'loan shark' end of the spectrum Merrill says that his new model for assessing a borrower's creditworthiness and setting installment payments means he can offer lower rates than standard payday operators. But when one is talking in either case about interest rates of more than 400%, the degree of difference is arguably meaningless.

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Former Google Exec Sees Payday in ZestCash

This is hardly better than online quick-cash lender, Checkngo.com, which offers a 14-day payday loan for $800 in the state of Utah, with a $200 fee, for a total of $1000 due after two weeks. But if you can't repay the money then and have to roll over



Used-car dealer aims to restore reputation
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A light went on for Mahrouq, and on graduating from UT Arlington in 1991, he formed a company to buy and export cars. In 1999, he bought a dealership lot at Division and Collins, located at an old fast-food drive-in, and began expanding from there.



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Cash, The Autobiography

Cash, The Autobiography

The country singer looks back over his life from his childhood on an Arkansas cotton farm, to his battle with drugs, to his myriad musical successes.

Utah

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Utah, a people's history

Utah, a people's history

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The Handbook of Loan Syndications and Trading

The Handbook of Loan Syndications and Trading

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The quick

The quick

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