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Cash Connections Case Study

In: Business and Management

Submitted By PhilG
Words 433
Pages 2
Philip Giuliano
Business Policy Spring 2013
Cash Connections Case Study

#1.) Cash Connection’s ability to compete appeared to be in dire straits with ever-increasing Federal restrictions and regulations on all aspects of companies within the financial service industry. Cash Connections provides payday advances and check cashing for workers, as well as bill payment services, and money orders. Payday Loans are short-term cash loans intended to covers the borrower’s expenses until their next paycheck. Loan fees and interest rates were high, naturally, because each loan carried such a risk for the company, and many people did not pay the loan back. The problem with Cash Connections strategy is that they garnished the reputation of “preying on the poor” and making almost insurmountable payday fees they knew couldn’t be paid back. Although they held a key demographic of middle income workers, they could very easily appear negligent. They did, however, add $10 billion to U.S. GDP, employed 156,000 workers and generated almost $3 billion in tax revenue.

#2.) A SWOT analysis would reveal several things. Cash Connections certainly has some strengths, and as of 2007 appears to have been quite successful in both garnishing revenue, as well as helping out people in need of fast cash. They do, however, carry a great weakness and risk with the individuals they lend to. They are almost categorized as a “legal loan shark”, via offers of loans and paydays with enormous interest rates. The intrusion of government into financial institutions will also prove a pressing issue to Cash Connections and all other companies alike. They do see opportunities I believe in business and big time loans to construction companies, and new businesses getting off the ground. I would suggest they begin to pursue them, more so than the average Joe attempting to rub two nickels together.

#3.) I believe...

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