Payday Loan Industry Is Unregulated

MYTH #6

There is a lack of regulation in the cash advance industry.

FACT

Both federally, and in each state, cash advances are extremely regulated in order to provide a valuable and safe situation for both the customer and the company.

Short-term Lending Governed by Extensive Federal, State Regulations

Both the state and federal governments regulate all short-term lenders. This type of competitive, regulated market allows for protection of both the lenders and customers, and our lenders strictly follow all laws and regulations.

State Regulation

While they vary by state, state laws highly regulate the cash advance industry. Such laws typically state how much a cash advance can be for, what fees can be charged, and what sort of repayment plan is allowed. Many states also allow the customer to undo the transaction within 1 business day.

In most states, cash advance lenders must be licensed, file regular reports on their business, and subject themselves to financial audits to ensure they are operating within current regulation.
Nearly every authorizing state has a law on the books that requires regulatory examination.
All but one regulated state requires that cash advance lenders be licensed, and more than 70% of states have financial requirements for such licensing, and nearly 60% have bonding requirements.
In all states, companies who violate these regulations are fined.

Federal Regulation

Multiple federal agencies regulate the cash advance industry, along with multiple laws and other legislation:

Federal Truth in Lending Act (TILA). All lenders must clearly provide the terms of any loan agreement and completely disclose any related fees, providing customers with the clear ability to compare the costs of such a loan with other alternatives.
Military Financial Services Protection Act. It is against the law to offer any type of loan over a certain APR to military personnel, therefore we cannot offer cash advances to any members of the military.