History of the Payday Loan Industry

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Historical Perspective on Payday Loans and Consumer Loans

"How to Loan Money to the Masses Profitably."

The passage of new consumer finance laws in various states and provinces has opened the doors to this highly lucrative business! Prior to these events, state usury laws made it impossible to justify the risks involved in this type of lending.

For example, as long ago as 1996 in California, Senate Bill 1959 passed and changed everything for us. Legislators realized the need for consumers to secure small, emergency loans, with little or no red tape. They also recognized that banks were closing branches as a result of mergers and acquisitions, making it difficult for their constituents to access bank services. Lastly, the typical consumer finance companies were not interested in originating $100 to $500 non-secured loans.

Since then, numerous additional states and provinces have passed enabling legislation. Of course, the industry has been attacked in many areas as well. And the federal government (UK, US, Canada, AU...) is looking at us pretty "hard."

But the one thing we've learned over all these years is that the "the business of lending money to the masses" - be that a payday loan, a car title loan, an installment loan, a personal loan..., call the loan product whatever you like - the consumer lending industry is made up of some very smart and creative individuals. And with the advent of the Internet, offshore and tribe consumer loan models, and the continued increased demand by consumers for our loan products and services, we are not going away.

Our customers will ALWAYS need small, quick, no hassle, loans to take care of "surprise" expenses, like auto repairs, cover a check they have written, rent due, phone or utility bill, etc., etc., etc.

The best thing about our business, in addition to the potential PROFITS, is the fact that we provide a much needed service to our clients and we save them lots of money! One example is the lawsuits against many of the big banks for charging NSF fees that exceed 2000% APR's. In a concerted effort to increase their profits, banks are accused of "clearing" a customers largest check first in order to collect multiple "NSF" fees! In these situations, it is much more economical to use our services than to "bounce" checks. And of course, where can one go in an emergency, for a quick $300 - $1500 loan! We are the only resource they have! Thus, a tremendous business opportunity exists.