Zest Finance CEO on Payday Loans

By | Oct 8, 2015

Zest Finance

TEDxNewWallStreet – Douglas Merrill – New credit scores in a new world: Serving the Underbanked

Wow! 12,000 payday loans funded every 11 minutes! Zest Finance entered the payday loan space when their founder got a phone call from his sister-in-law. She needed to borrow a few hundred bucks to purchase tires so she could get to work.

Luckily for her, Doug Merill, ex-Google honcho and founder of Zest Finance, had the cash.


Payday Loan Industry Haters & Why?

By | Oct 8, 2015

This is one of the VERY BEST explanations for ALL the attacks on the payday loan industry!

It was written by Steve Sherman at Human Events. Hate payday loans, or love them, you have to invest 5 minutes of your time. This theme of Washington insiders attacking an industry for machiavellian reasons is MUCH BIGGER than one industry.

“The attack on the “payday lending” industry has been financed by a number of non-profit organizations, the lead attack dog being the Center for Responsible Lending (CRL). Who’s that? Again with the nice, focus group tested, responsible name. They are a group that, you guessed it, does short-term, small dollar lending and would profit immensely by the demise of the current system.”

Payday Loan Consultants“CRL describes itself as “a community development lender, credit union, and real estate developer that works with individuals, organizations, and communities traditionally underserved by conventional markets.” CRL’s founder and CEO is Martin Eakes. Eakes’ organizations are seeking to use government intervention to replace the short-term lending industry with his own version of small dollar lending. Sounds like a smoky back room deal to me.”  READ MORE


Payday Loan Lawsuit

By | Sep 23, 2015

Another Payday Loan Lawsuit

Are you a payday loan lender? Be aware! You’ve got a target on your back. The bigger we get the more often it makes sense to settle rather than fight these class action payday loan lawsuits. I’ve “been there – done that.”

Three former non-exempt employees sued PLS Financial Solutions of California, Inc. (formerly Payday Loan Store of California, Inc.) and PLS Check Cashers of California, Inc. on behalf of themselves and others and alleged various California Labor Code violations  including, but not limited to:

  • Unpaid meal and rest premiums
  • Failure to pay all regular and overtime wages
  • Unpaid and/or untimely vacation wages
  • Waiting time penalties
  • Failure to provide and maintain accurate paystubs and civil penalties under the Private Attorney General Act.

Stupid things payday lenders doAfter extensive investigation and an exchange of relevant information, the Parties agreed to enter into private mediation to try and resolve the claims.  The Parties attended mediation and thereafter reached the Class Settlement memorialized in the Joint Stipulation of Settlement and Release on file with the Court, and whose terms are generally summarized in this Notice… Click here to read the Settlement in it’s entirety.

You can still profit handsomely in the small dollar credit space BUT you must know what you’re doing. Get all the startup info here: Payday Loan Manual.


Installment Loan Profits: The Business of Installment Loans

By | Sep 21, 2015

Installment Loan Profits

An installment loan business offers tremendous opportunity BUT there are caveats. The first is the implementation of the 36% APR that many consumer advocates propose.

A $500 installment loan for a period of six months at a 36 percent APR produces total revenue of $53.79; just under $9 per month. If just one loan in a portfolio of these installment loans default, the installment loan lender must make ten “good” loans to recover their loan principal on the one bad loan, without considering operating costs on any of the installment loans in their portfolio.

installment loan business

To the tune of “Everything’s gonna be alright.”

The installment loan lender still requires enough revenue to justify obtaining and maintaining the lending location or internet platform, customer acquisition costs, hiring and paying their installment loan employees, acquiring the supplies and equipment required to run an installment loan business, the costs of maintaining ACH, loan management and Image Cash Letter (ICL) vendor relationships, securing a dependable bank account and all its attendant costs, and complying with the regulations both at the state, FED and or Tribal level.

A DAUNTING TASK, 36%? I Guess the so-called consumer advocates whose agenda is <36% APR’s would like to see installment lenders make it up with volume :-)


Impact of City Ordinances on Payday Loan Lending

By | Sep 17, 2015

Payday Loan City Ordinance Impact

What impact do payday loan city ordinances have on payday loan store-fronts, commercial property owners, employees, payday loan borrowers and ancillary businesses?

City bureaucrats weep:Local ordinances restricting access to small dollar credit do not restrict usage but drive consumers to other forms of credit.”
Tim Ranney, President of Clarity Services.

I would add, specifically to the Internet! Jer Trihouse


Change in online and storefront payday loan usage before and after city ordinance passed

City ordinances drive borrowers to the Internet

Change in online and storefront payday loan usage before and after city ordinance passed

Data Set:

  • 750 million consumer inquiries
  • 100 million storefront records
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