Payday Loan Business: A Magical Method to Increase Profits

Face it! Paying your payday loan employees $8.00 to $12.00 per hour just won’t get the job done. You have to incentivize your people to achieve your goals.

Doesn’t seem fair does it? You’d think a decent hourly wage with a couple of breaks and lunch thrown in would do it. But it doesn’t.

You want a tip? Figure out what you’re trying to achieve and pay your people a bonus to get it done.

You want examples? Here’s what works for us.

When we open a new payday loan or scrap gold location WE WANT TRANSACTIONS! We want to fund loans; as many as we possibly can. So… after checking our competition, studying the demographics in our area, formulating our advertising spend and determining how much money we have available “for the street”, we give our payday loan and car title loan store reps a minimum target and pay a bonus for every transaction exceeding this target. WE PAY THIS BONUS DAILY!

Now, the exact numbers will vary depending on the size of the market we’re in. But our employee bonus system looks something like this.

Our goal week 1 in a new market might be to fund 3 loans per day per employee. (In small markets with plenty of competition we might only have one employee working 10 hours/day.) Our bonus system might pay $5 per funded payday loan beginning with #4 for the day. So should our employee get 6 payday loans funded that day, they earn their hourly wage plus a bonus of $15 PAID AT THE END OF THEIR SHIFT.

(REMEMBER! That new payday loan customer could easily be worth $5000 or more in fees over their lifetime.)

We might implement this bonus system weeks 1 through 4 and then adjust it to a minimum of 6 per day week 5.

Don’t forget to adjust! Perhaps by week 30 you’re more concerned about collections than you are about transaction volume. As discussed in our Payday Loan Collections Manual, place your overdue receivables in buckets; 0 - 30 days, 31 - 60 days, 61 - 90 days, 91-120 days, and 121 days+.  You might pay your employees a percentage of dollars collected; a little more for each bucket. Or a flat fee per contract paid on.

Now, I’m not going to discuss the justifications for paying IMMEDIATE bonuses to an employee for simply doing their job. And we don’t need to quibble about the actual numbers/goals other than to say you must make the target a challenge, communicate it to your employee, MAKE IT SIMPLE and yet be achievable.

BOTTOM LINE, THIS STRATEGY WILL BUILD YOUR BUSINESS!

Get creative.

This system works for both our stores and our Internet business and for a multitude of products we offer.

Good software makes this bonus system MUCH EASIER TO IMPLEMENT. See the software chapters in our Payday Loan Manual and our Payday Loan Internet Report.

Empower your people. Set them free. Trust them. The amount of trust that Google puts in its employees and how amazingly those employees deliver results is impressive. This works for our industry as well.

Organize and simplify. (You really should read, “The E-Myth Revisited“)

Finally, as a business owner, the need to implement a bonus system to motivate your employees to perform their job may seem REALLY UNFAIR. GET OVER IT! JUST DO IT!!

THIS WORKS!

What do you think? Jer@PaydayLoanIndustry.com

What’s your biggest problem? Jer@PaydayLoanIndustry.com

Need our Collections Manual?

Want to start a Payday Loan Internet Business?

How to start a Payday Loan Business?

Washington Payday Loan Law

Washington State payday loan laws in a nutshell:

The Washington State payday loan law limits the size of a payday loan to 30 percent of a person’s monthly income, or $700, whichever is less. It also bars people from having multiple loans from different lenders, limits the number of loans a person can take out to eight per 12 months, and sets up a database to track the number of loans taken out by people.

Payday loan limit is capped at $700.00 or 30% of gross monthly income, whichever is less.

A statewide databases established so that payday lenders can track their borrower’s loans.

If a person is not in a position to repay on time, they can ask the lender for an installment plan, which the lender must provide free.

Payday loan lenders may not harass people who can’t pay

Payday loan consumers have access to 8 payday loans per year.

UK Door Stop Lenders Blamed for Poor!

A study by the UK Public Policy Research Institute, which followed the economic fortunes of 58 low-income families, came to the conclusion that making easy credit available to the poor actually harms them.

I suppose the rational is that by not acting as a lender of last resort, the families having exhausted all other means of obtaining cash to pay their rent, buy food and keep the lights burning, these families would have accessed the public dole much sooner.

But wait! The study goes on to describe how the U.K. government is stretched beyond capacity to contend with the growing numbers of families having no where to turn for emergency financial help. Another recent report revealed the government of the U.K experienced a 28% increase in demand by the financially challenged for “crisis loans.”

These people are nuts! Their report actually states, “Cheap credit has pulled the UK’s poorest families into a spiral of debt.” What are they thinking? Would not these families have run out of options even sooner had the “door stop lenders”, payday loan operators, car title and other “no credit checks and no questions asked” lenders failed to provide emergency cash?

Because we make money available to families who have no where else to go WE ARE TO BLAME for their misfortune! Man, I don’t get it.

Wisconsin Payday Loan Laws & Legislation

Payday Loans and Wisconsin - A Good Compromise

Wisconsin payday loan regulators have stitched together a compromise bill that offers strong consumer protection and allows the very popular payday loan product to continue to be offered as one of many financial solutions for Wisconsin residents.

In essence, the proposed Wisconsin payday loan bill will limit payday loan consumers to a maximum $600 payday loan or 35% of a borrower’s 2-week gross income, whichever is less. This proposed $600 maximum payday loan would include any fees associated with the payday advance.

This payday loan legislation would not cap the annual interest rate that lenders can charge on payday loans. A previous bill would have limited them to 36 percent. Rep. Donna Seidel, D-Wausau, said, “The cap would have gone too far in choking off credit for borrowers struggling in the economic downturn by essentially wiping out the industry.”

Additionally, the proposed payday loan legislation allows payday loan borrowers one payday loan at a time. This would be assured by the implementation of a Wisconsin payday loan data base to be industry funded; $1 per payday loan.

Consumer protectionists applauded the proposed Wisconsin payday loan legislation because it specifically prohibits payday loan lenders from “rolling over” a payday loan consumer’s outstanding debt into a new payday loan. This addresses the so-called “cycle-of-debt” issue, a practice attacked by competitors against payday loan products. This includes banks, installment lenders and credit unions.

In 2008 Wisconsin, it’s estimated there were 530 payday loan stores that gave out 1.2 million loans totaling $723 million.

Payday Loan Collection Scam - Vultures on the Prowl

Payday Loan Collection Scams

If you’re one of the millions of payday loan consumers out there, BEWARE!

Collection company agents are scamming payday loan users out of their hard earned cash.

The Kansas Attorney General, Steve Six, reports that Kansas residents are complaining about collectors calling with claims that the consumer took out an Internet based payday loan and never repaid it.

There are unsubstantiated claims by residents of other states as well.

Some of these payday loan collection agents are posing as law enforcement officers! It’s not uncommon for these collectors to threaten consumers with jail.

Payday loan consumers should be aware that their is no debtor’s prison in America.

These scam artists often identify themselves as ACS, National Affidavit Processing Department and United Financial Crime Division. The calls may be originating offshore.

It’s not unusual for the payday loan collection agents to have the ability to provide their victims with personal data including social security numbers and bank account information; even computer IP numbers.

Western Union appears to be the preferred method of payment requested of the consumers.

If contacted, consumers should demand a written notice specifying the amount of the debt, the name of the payday loan company, contact information of the payday loan company, and validation of the debt.

We advise the consumer to immediately determine if the payday loan company is licensed in the consumer’s state! If not, do not pay!

One last point; our readers should not conclude that these collection scams are singularly focused on the payday loan industry. These vultures ply their wares in virtually every financial product offered in the marketplace today.

Magic Numbers Don’t be misled by payday loan statistics.

Magic Numbers - Don’t be misled by payday-loan statistics.

This is an interesting article by Thomas Sowell at the National Review.

It’s a good read! Mr. Sowell begins … “Words are not the only things that enable political rhetoric to magically transform reality. Numbers can be used just as creatively — and many voters are even more gullible about statistics than they are about words, apparently because statistics seem more objective.

The latest congressional crusade is to clamp down on small finance companies that provide “payday loans” and check-cashing services in many low-income neighborhoods, where there are few banks.”

He goes on… “A common practice in making small loans of a few hundred dollars for a few weeks is to charge about $15 per hundred dollars lent. Politicians, the media, community activists, and miscellaneous other busybodies are able to transform these numbers into annual percentage charges of several hundred percent, thereby creating moral melodramas and demands that the government “do something” about such “abuses.”

Read the article in its entirety here: National REview.com

OLA-Online Lenders Alliance Internet Payday Loan Lenders Association

The OLA, Online Lenders Association-a payday loan organization comprised of Internet Payday Loan companies, placed advice about contributing to the Haiti Relief Program.

From their web site: ”

We have all seen and heard about the devastation in Haiti.  As an organization and an industry who knows the hardship of people in need, we wanted to bring you some information about donating to the relief effort.

Congressman Meek has directed us to the InterAction website which lists multiple charities to whom you may wish to contribute.  Click InterAction to access their webpage.

We have been advised that the best way to help is to donate financially to organizations responding to a disaster.  Cash donations allow relief professionals to procure exactly what is needed in a disaster situation and ensure that donations are culturally, dietary, and environmentally appropriate.

You can also click Red Cross to go directly to their donation page.

You can donate $10 to the Red Cross and have it charged to your cell phone bill by texting “HAITI” to “90999.” (There will be no processing fees).”

The Online Lenders Association organized in an effort to provide a sense of standards and guidelines for Internet based payday loan lenders.

As the Online Lenders Association OLA web site states, “All member companies have agreed to a List of Best Practices and Code of Conduct developed by OLA to ensure that consumers are fully informed and fairly treated and are using all lending products and practices responsibly.”

Illinois Payday Loan Law Reform SB 1435 Redundant

Illinois Payday Loan Reform Act SB 1435 is redundant. Illinois payday loan lenders already disclose fee schedules, APR - Annual Percentage Rates, any balloon payments due, payment due dates and much, much more.

If any of these “protect us from loan sharks” advocates would simply visit a payday loan store, read the disclosures on the walls, take a look at the 14pt fonts on a typical contract and, MOST IMPORTANTLY, talk to a real, live payday loan customer, they would focus on building our economy via jobs and not more restrictions.

Payday Loan Internet Biz 4 Sale

Just a quick blast to let you know about a Payday Loan Internet business that has suddenly become available.

For those of you in the market for a turnkey payday loan business, we have one!

Here’s the lowdown from the seller:

“Small Internet Payday Advance company for sale.  10+ year old
company is winding down business and is currently maintaining its
current customers and is not processing any new advance requests.
Customer base has set payment plans in place to payoff all advances
by year end 2010. Many returning customer and new requests are not
being accepted or funded.

******************Our Sponsor***************************************
http://goldintoloot.com/
Learn to buy and sell scrap gold a silver-Our Stores Netting $1000’s Monthly
********************************************************************

Company website and URL’s are included.  Use Payday Loan Manager
(PLM) system, Accurint and Teletrack.  Has large data base of applicants.

If interested email your inquiries to:
4SaleInternetCo@PaydayLoanIndustry.com

Run this strictly as a payday loan Internet business or take the plunge, embrace the Internet and combine this opportunity with your store.

You get an Internet business with an existing revenue stream and customer base. You can hit the ground running with an immediate revenue stream AND you’ll get training from operators having 10+ years of experience!

So again… email:
4SaleInternetCo@PaydayLoanIndustry.com
INCLUDE YOUR CONTACT INFO AND BEST TIME TO REACH YOU.

ALSO… what subjects do you need covered?

Are you a vendor or supplier? Advertise here:
http://www.paydayloanindustry.com/payday-loan-vendors.html

Want to be a contributor? Enjoy writing? Got a topic, a product? A Solution? A bone-to-pick? Let me know!!

Jer
jer@PaydayLoanIndustry.com
The Team at Trihouse Payday Loans
702-889-9555
email us: PaydayGuys@PaydayLoanIndustry.com
http://paydayloanindustry.com/cash-advance-store.html Knowledge Store

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http://www.PaydayLoanIndustryBlog.com Checkout our Blog
http://www.CheckDataSystems.com Help with Collections
http://www.PaydayLoanLegislation.com Laws & Legislation
http://www.AutomobilePawn.com Make $$ in Auto Pawn
http://www.GoldintoLoot.com Buy Sell Scrap Gold & Silver

Payday Loan Operators-How to Make Tons of Cash With Your Data

Can you use FREE money? Would you like to make a ton of money with your existing customer data? A ton of money just with your “dormant files” and your non-current customer information?

Your customer data has tremendous value. And there are companies willing to pay you a ton of money every month for this information. You can monetize your customer data at zero expense to you and with no risk of cannibalizing your data.

And there is zero risk of ANY marketing to your data by third-parties!

This is literally FREE CASH FOR YOU!

So…  want to know how this works and what it means in dollars and cents to you and your operation?

Read on…

You, the data owner or Contributor, “park” your consumer data records with “THE COMPANY” via a data transfer to a secured FTP web site. The data is stored using state of the art security to protect all data. “THE COMPANY” scrubs this data against their current database of records. Any data records “THE COMPANY” doesn’t already have in their database are accepted and held in the Contributor’s (that’s you).

When one of the clients of “THE COMPANY” (typically a licensed and bonded debt collector or law firm) performs an authorized social security search for a consumer and they find it in your file and purchase the consumer record from “THE COMPANY”, you share in the revenue derived from that sale.

So… a debt collector has paid “THE COMPANY” for the consumer data that you provided “THE COMPANY” thus enabling you to receive a commission for your data contribution.

Let’s use an example.

XYZ Payday Loan Company dumps 100,000 records into “THE COMPANY’s” database on January 5. “THE COMPANY” reconciles the 100,000 consumer records provided by XYZ and discovers 37,000 of those consumer names are unique and not yet in “THE COMPANY’s” database. (Let’s say the other 67K consumer names were already present having been contributed by other Payday Loan Companies.) So… continuing our example, let’s say for the next 25 days remaining in January, clients of “THE COMPANY” search for 50,000 records of which 75 “hits” come from records previously submitted by XYZ Payday Loan Company.

“THE COMPANY” bills their clients (Collection Companies) net 30 at the end of January for let’s say 75 hits X $20.00/ea. = $1500.00. “THE COMPANY” collects this $1500.00 from their client by March 1 and pays you, the Data Contributor, X% of the $1500.00 collected. Typically, you’ll receive payment about 60 days after your first data contribution followed by monthly cash payments after that.

Benefits to you, the Data Contributor?

Additional revenue by monetizing the consumer data you have anyway! Consumer data from your dormant or denied files and non-current customers; data you have zero use for! Dead data that would not normally yield revenue to you!! FREE MONEY!!!

How it works.

Simple! You simply dump your data at a secured FTP web site. Virtually all file types are can be accepted. Then you make regular data dumps to the FTP site to keep growing your record base. Hot lining the data after the initial transfer usually yields higher returns. Just ask we will explain!

How to Qualify.

You really need at least 50,000 records less than 12 months old. Data records older than 12 months are acceptable but not as valuable. Contact us! Let us know what you have! This program is for both Internet and Store-front operators in consumer related industries.

How to Turn Your Consumer Data into $$$$$$

Send an email to:
4DataDollars@PaydayLoanIndustry.com
Your Name, Phone, Best time to call.
Please include an approximate number of records you have along with the aging. For example: I have 65k records from the last 6 months, 100k records in the 6-12 months age and another 200k over 12 months old.

All information is kept strictly confidential and your company name will never be disclosed as a data contributor.

Does this sound like a no-brainer? Your thoughts? What micro-lending information do you desperately need?

Do you have a  that’s service, product or opportunity that is relevant to our readers?

TALK TO ME!
Jer
Jer@PaydayLoanIndustry.com