Hey PaydayLoan Biz Fan,
Google update and Lending Club implodes? This means total upheaval in our industry:
From Google today:
“To enforce the policy, those seeking to market financial products through Google’s sprawling advertising network will be required to disclose the length of the loan and the annual interest rate before they will be allowed to place ads. In addition to the broad payday loan ad ban, Google will not display ads from lenders who charge annual interest rates of 36 percent or more in the United States. The same standards will apply to sites that serve as middlemen who connect distressed borrowers to those lenders.”
My immediate interpretation?
* Google = total hypocracy! Google Ventures provided $14 million dollars to Sasha Orloff at Lendup – a payday lender – back in 2013!
* A tremendous opportunity for those of us with the creativity build-out alternative marketing channels enabling small dollar loan consumers to solve their temporary financial challenges and to tell Google and Facebook to F%%$$ off. MassRoots is doing it for cannabis. Gun sales continue to thrive via new strategies as well.
* Lead generators are toast for now. Witness T3 leads. They were experiencing bad times long before this latest Google policy change.
* Brick-n-mortar operators move up the food chain and are in “the catbird seat.” Location, signage, branding, offline marketing, mobile phone friendly websites, blogging… is more important than ever. B & M valuations headed up for this cycle. Suddenly, the guy or gal consumed with running their store(s) no longer needs to dissect Google’s PPC strategy.
This new Google initiative doesn’t mean payday loan ads will no longer appear. It simply means the 1st 4 ads at the top of Google search results will not contain sponsored ads.
Anyone with a brain knows the single-payment PDL product has been phasing out.The new mantra is “personal loan,” installment loan,” “line-of-credit…” These holier than thous will never succeeed in shutting down financial services products that millions of consumers want and need!
On another front, Lending Club imploded yesterday. Their CEO got caught with his hand in the cookie jar. What’s this mean for us? Lendup loaned out $1 Billion dollars in the 1st quarter of this year! This was off-balance sheet money. Now, Lendup, Prosper, OnDeck, Kabbage, Avant… the “FinTech’s” will have a hell of a time offloading, securitizing and enticing the “capital” to their lending platforms. Although they have a tendency to appeal to 620 and higher FICO scores, they generate leads and funnel them to PDL lead generators and direct lenders. Competition from them is on the decline; at least for the forseeable future.
One more time: DISRUPTION = OPPORTUNITY. Seize the day! Lending money to consumers and small businesses will not go away!
Will car title loans get the shaft from Big Brother Google as well? http://www.AutomobilePawn.com
Finally, I want to thank Google for making it easier for ENOVA to make money in the payday/small dollar lending space. Enova started as CashNetUSA back in the 90’s. They have a HUGE data base of borrowers that probably doubled in value after this Big Brother action by Google. I own a lot of ENOVA shares
Was this email forwarded to you? Get my alerts on the PDL and title loan industry here:
Teacher… Lender… Resource… Answers…
It’s INCREDIBLE how PROFITABLE and POWERFUL a consumer lending business can be!
Simply put, lending is the best possible business you can be in.
Why? Your inventory is cash and credit. It’s not roses or fruit rotting. It’s not cars depreciating. It’s not selling your accounting or car repair service over and over again while you pray you don’t receive a bad Yelp review!
YOUR inventory is MONEY! And EVERYONE needs MONEY!
Call these loans payday loans, installment loans, line-of-credit, cash advances, FinTech…
Whether you’re focused on starting or improving as a lender via the store model, the Internet model, or a combination of the two, we pledge to bring you the latest news, solutions, legislative developments, vendor offerings and more.
Some of our topics in the past have included collection techniques, software, the Internet, store selection, man-loading, identity validation, alternative payday loan methods, the Credit Services, Organization Texas-Ohio (CSO/CAB) Model, loan management software (LMS), industry conventions and much, much more.
Our latest ramblings are available here: http://www.PaydayLoanIndustryBlog.com
If you’re relatively new to the payday loan industry and are in need of solid, thorough payday loan knowledge, we recommend you consider investing in our 400+ page How to Start a Payday Loan Training “Bible” available in a printed or Adobe Acrobat version.
We print and ship our latest version of this Manual to you in a 3-ring binder with a CD containing sample contracts, disclosure forms, APR calculation formulas & examples, laws, statutes, fee structures and more for your state or province. You may review the contents of our Payday Loan Training “Bible” here:
http://www.PaydayLoanIndustryBlog.com/courses Note that our “Bible” covers both the Internet Model and the Store Model. Additionally, we thoroughly cover the various licensing models including state, province, offshore, tribe and Texas/Ohio CSO/CAB.
The payday loan industry is an extremely dynamic, profitable niche. We made our entry into it in late 1997. Today we operate stores and websites in addition to consulting. We are not simply three guys who write books! We are Lenders, consultants and conduits for payday loans, car title lending installment lending and scrap gold businesses.
Email us Jer@TrihouseConsulting.com with ANY questions or requests for help. You may also call us at 702-208-6736. (PDT)
We look forward to helping you make substantial profits in the Payday Loan Industry.
David Lazarus, the author of a hit piece in The Los Angeles Times, calls the collaboration of both Republican and Democratic lawmakers on a payday loan bill “a bizarre display of bipartisan cooperation to cripple the Consumer Financial Protection Bureau.” This statement is folly!
“The bill would delay federal regulations for payday lenders by two years. It also would allow states to adopt more lenient rules for the industry.” The States should have the ultimate say in regards to credit access for their residents! What do the bureaucrats in D.C. know about this topic? Zip!!
“Wasserman Schultz is joined by eight other Democrats in co-sponsoring the legislation alongside twice as many Republicans.” Finally, both sides of the aisle are working together on SOMETHING!
Wasserman Schultz’s spokesman, Sean Bartlett, said the legislation “is about preserving the shared goal of implementing strong consumer protections while also preserving access to affordable lending for low-income communities.”
Obviously, these Democrats and Republicans who are working together on this payday loan legislation are more in touch with their constituents then Richard Cordray, the head of the CFPB in Washington!
The CFPB’s own “Winter 2016 Complaint Report” reveals payday loan complaints declined 12%. Of the total 20,887 complaints received by the CFPB, 409 were in regards to payday loans. That’s .019%. [Here’s a link to their actual Report.]
“Under preliminary requirements unveiled last year, lenders would have to determine upfront if a borrower can repay the loan.” This statement is ridiculous! Payday loan lenders don’t go to the FED and get 1% money – like BANKS do. We’re lending OUR OWN MONEY. If our borrower cannot pay us back, we’re OUT OF BUSINESS! STUPID!
Our loans are not collateralized. All we have is the consumer’s promise to pay us back. In Wasserman Schultz’s state of Florida, which Lazarus attacks, a resident of Florida borrows $100 and pays back $110.00 two weeks later. That’s it! No subterfuge. Unlike bank NSF fees, this $10/%100 fee structure is plainly visible on the walls and in every consumer contract in English and Spanish in 18 point fonts!
The author is in Los Angeles, Calif. Has he ever bothered to actually visit a payday loan store? Doubtful. The State of California passed its own payday loan laws in 1997. We charge $17.65 per $100 borrowed. So… customer borrows $100 today, they pay us back $117.65 in two weeks. Sign on the dotted line, prove to me you can pay me back my money, show me you have a checking account and you’re approved. In and out in 10 minutes. SIMPLE! And that’s exactly what my customers want.
I congratulate these bipartisian ELECTED representatives for at least taking another look at the draconian measures the CFPB beaurocrats are attempting to do in restricting a wide spectrum of financial products to U.S. consumers!
Finally, I suspect all of these measures will soon be moot. Silicon Valley, Austin, London… launch new FinTech companies weekly. Orchard, Avant, Lendup, Prosper, JP Morgan, and on and on are rapidly changing the consumer and small business loan offerings available. The bureaucrats simply cannot keep up!
Consumer Confidential: Why is a group of lawmakers working to undermine tighter rules for the payday-loan industry?
In a bizarre display of bipartisan cooperation, a handful of Democratic lawmakers have joined Republicans in trying to cripple the Consumer Financial Protection Bureau. The question is: Why? Most notably, Florida Rep. Debbie Wasserman Schultz, who also serves as chairwoman of the Democratic National Committee, is co-sponsoring the deceptively titled Consumer Protection and Choice Act, which… Continue Reading >>
I get calls every day from lenders in PAIN!
What kind of PAIN you ask?
• Fear about what the CFPB/regulators will do to us
• What our friends, family and neighbors think of us
• What new city ordinance is going to be passed against us
• Who might sue us next
• How do we collect our money
The #1 PAIN? How to take care of our existing customers and how to get more of them!
At a minimum, there are 45 MILLION+ customers out there who want to do business with us.
The LIFE TIME VALUE (LTV) of just one customer is $4,236 – $15,000+ in fees generated!
So… if you miss just ONE customer you’re talking about SERIOUS PAIN!
(Relax! I’m getting to PAIN relief)
Look, I have no clue as to what the CFPB will do – if ANYTHING. The Chairwoman of the Democratic National Committee just introduced HR4018. This changes the game in our favor BIG TIME! And CSFA, FISCA, OLA, NASFA, our lobbyists, our State associations are all working hard…
If you’re still concerned about what your friends, family and neighbors think, open a pizza store. I’m certain that too will meet with some disapproval.
City Ordinances? As I’ve been saying for years, “Embrace the Internet or Die!” Cities can’t enforce their crazy laws anyway. The State will prevail. But, be prepared…
Most importantly, let’s not forget our customers. Our CUSTOMERS support us big time! Over and over again – at hearings, meetings and CFPB rallies, they’ve expressed their desire for continued access to our products and services!
ENABLE YOUR CUSTOMER TO DO BUSINESS WITH YOU!
Online & Storefront Lenders.
Don’t lose a customer because you’re CLOSED. Be available 24/7 to make loans/$$
Are you losing business to your competition because of your hours of operation?
You want to service more customers? You want to make more loans? The magic words are “SPEED” and “AVAILABILITY.”
Speed of customer contact is huge! If you wait five minutes to call a lead after you purchase it, chances are the customer has been contacted by someone else already.
If your customer has to wait in line while your CSR’s answer your phone, they will bolt!
How many times have you experienced this yourself? You’re in a place of business. You wait in line for your turn. The phone rings. Suddenly, the caller on the phone has literally jumped into line ahead of you. The caller is not placed on hold. YOU are! Patience is not a virtue!
During the past week, Team Trihouse called 132 loan companies after hours. 93% of the time, all we got was a poorly worded recorded voice!
“Hello, sorry we missed you. Our hours are Monday through Friday 10 A.M. to 6 P.M. and Saturdays 10 A.M to 2 P.M. Please leave a message and we’ll return your call. BEEP…”
As “The Donald” would say, “STUPID!” 82% of the companies we left a message with NEVER returned our call.
Lenders are spending $$ on store branches, signage, leads, TV, radio, car wraps, direct mail, bus benches, on and on while FAILING miserably at serving their customers.
OK, ENOUGH! How do we fix this?
Hire and train more CSR’s and staff them 24/7.
WHOOPS! That’s expensive, time consuming and hard to scale.
A simpler way? Try Centrinex
OK, here comes the PITCH.
But seriously, I know Centrinex works! You can stop being “STUPID.” You can be “open” 24/7 and beat the pants off your competition.
Remember your customer’s Life Time Value? $4,236 – $15,000+
• Centrinex has provided outsourced call center services to the short term lending industry for over 10 years, with 5 facilities (Domestic and Near-shore), and 25+ lenders currently enjoying the advantages of having partnered with Centrinex.
• Flexible solutions from standard operating hours to after-hours coverage, shared resources and even per-minute billing are available. You can expand your hours of operation without expanding your real estate and salary expense. Ramp-up as your needs dictate.
• Centrinex will call your loan applicant immediately. The moment your loan form is submitted by your loan customer a Centrinex CSR will call them while they’re still at their computer!
• When your phone rings, a Centrinex CSR will answer in seconds.
• After hours coverage allows you to purchase lower cost leads when your competition has closed for the day.
• Loan applicant fraud is HUGE. Partner with Centrinex – a Team who already “knows the ropes” and can assist in refining your underwriting to maximize loan performance.
• Online application abandonment. Centrinex can provide “Overflow Coverage” for peak periods your in-house staff cannot support.
• 24/7 Centrinex call center support for lead sellers. Maximize your lead inventory and monetize your denied leads.
• Centrinex works with all loan management software programs.
• Multi-lingual CSR’s available
• Collections: Centrinex averaged 35%+ success on 30 day debt in 2015
• Champion-Challenger: Is your current call center performing as well as you think? Run a campaign against your internal Team to find out.
• Disaster Recovery: Maintain a small, low cost staff solution with Centrinex in event of unexpected down-time/failure.
CONTACT TEAM CENTRINEX:
Frank Cotton 678-851-8116 (Cell)
Are you attending CFSA in The Bahamas March 7th – 10th? Look for Frank. Give him a call.
Here’s Frank’s ugly mug:
Good News for Payday Loan Consumers!
The CFPB takes a “hit” from the chairwoman of the Democratic National Committee!
Surprise! CFPB Gets a Right Hook from Rep. Debbie Wasserman Schultz (D-Fla.) & H. R. 4018
By: Jer Trihouse. The chairwoman of the Democratic National Committee is pushing a bill H. R. 4018 that would delay new payday lending regulations.
Finally, someone in D.C displays some sense regarding the needs of millions of consumers needing access to emergency loans!
Rep. Debbie Wasserman Schultz (D-Fla.) is co-sponsoring the “Consumer Protection and Choice Act.” H. R. 4018 places a two year delay on pending rules from the CFPB – Consumer Financial Protection Bureau.
[Man, is this going to piss… I mean ANNOY, CFPB Director Cordray!]
The legislation exempts states with exisiting payday lending abuse laws from the rules. Wasserman Schultz’s home state of Florida has one such law on the books, and 12 of the bill’s 24 co-sponsors are also from the Sunshine State.
“As a state lawmaker, she helped write Florida’s law that has sharply reduced the need to go to bad actors, curbed predatory practices and created standards and protections for low-income borrowers,” Wasserman Schultz spokesman Sean Bartlett said.
Here’s a portion of H.R. 4018: (Link to H.R. 4018 at bottom)
To amend the Truth in Lending Act to establish deferred presentment transaction requirements, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Consumer Protection 5 and Choice Act’’.
REGULATION OF DEFERRED PRESENTMENT TRANSACTIONS AND DEFERRED PRESENTMENT PROVIDERS.
If the Director of the Bureau determines that a State has in effect a covered deferred presentment law, any regulations of the Bureau with respect to deferred presentment transactions and deferred presentment providers shall not apply in such State.
COVERED DEFERRED PRESENTMENT LAW DEFINED.
For purposes of this section, the term ‘covered deferred presentment law’ means a law or regulation of a State that provides for the licensing of deferred presentment providers and the regulation of deferred presentment transactions, which may be accomplished through existing State authority, and that meets the following requirements…
Here’s the LINK to the Bill.BILLS-114hr4018ih