Payday Loan Guy Versus The Other Side

There is some pretty good conversation going on over at a Montana Blog, “4 and 20 Blackbirds” regarding a Montana initiative addressing Montana payday loans. To gain insight into both sides of the payday loan issue, head over to:



Payday Loan Law Montana: House Bill 396

New payday loan legislation is slowly moving thrrough the Montana House.

Montana House Bill 396 adding additional regulations to payday loan companies operating in Montana:

Montana Hose Bill 396


Payday Loan Law and Legislation Idaho

Idaho Payday loan law Senate Bill 1093

PAY DAY LOANS – Amends existing law to provide that a lender which is not a supervised financial organization may not deposit a consumer’s check, withdraw funds electronically from a consumer’s account or otherwise collect the principal of, interest on or any fees or charges for a loan subject to this part if at the time the lender makes the loan, the lender does not have a current and valid license to make loans in this state.

Idaho bill text:

Idaho statement of purpose:



Payday Loan Industry South Carolina Laws

The South Carolina House passed new payday loan legislation with the help of  House Speaker pro tem Harry Cato who expressed his support of “fair regulation.”  Finally, a tempered, well thought out approach to the payday loan industry!
Associate Press reports that the bill was approved by the South Carolina House with a 93-16 vote. Consumers will benefit in that the bill allows them to have one loan at a time for up to $600. In addition, an online database (provided by Veritec) that will be operational by February 1, 2010 will record when loans are made. Payday loan lenders will be required to check this database each time a consumer applies for a loan. Customers who are approved will also have the option of an extended payment plan if they are unable to pay within the standard two week’s time.

Another part of the bill limits customers to 10 successive payday loans. After that, they must wait until at least one payday has passed before they can apply for another.

Of course, Payday loan critics don’t feel these requirements are strong enough but there are substantial studies that refute this erroneous thinking.

However, more thoughtful proponents of financial choice for consumers, Speaker Bobby Harrell for example was quoted as saying:

Regulating the practice and enacting consumer safeguards is the right thing to do. These loans are meant to be short-term financial solutions for unforeseen expenses; capping the loan amount and creating a statewide database to ensure that someone can only have one loan at a time will help prevent individuals from falling into a bottomless cycle of debt.

We applaud Speaker Harrelland Speaker pro tem Harry Cato for their insight and understanding that everyone needs access to small, temporary loans for emergencies!


Payday Loan Industry QC Holdings Fourth Quarter Results 2008

Payday loan, installment loan lender, buy-here-pay-here (BHPH)  operator QC Holdings Inc. reported revenue growth of 8% for a strong fourth quarter 2008.

About QC Holdings, Inc.

Overland Park, Kansas based QC Holdings, Inc. is a provider of short-term loans in the United States, operating 585 branches in 24 states at December 31, 2008. Having 25 years of operating experience in the retail consumer finance industry, the company entered the short-term loan market in 1992 and, since 1998, has grown from 48 branches to 585 branches through a combination of de novo branches and acquisitions. During fiscal 2008, the company advanced approximately $1.4 billion to customers and reported total revenues of $227.7 million.

“Our fourth quarter results were a nice finish to 2008,” said QC Chairman and Chief Executive Officer Don Early. “Despite the obvious economic headwinds, our field personnel contained losses while improving revenues and minimizing operating expenses. This effort produced a 15% growth in pre-tax income quarter-to-quarter.

Highlights for the fourth quarter included:

  • Income from continuing operations of $4.0 million, or $0.22 per diluted share;
  • Income from continuing operations of $4.3 million, or $0.24 per diluted share, exclusive of governmental affairs expenditures in connection with 2008 ballot referendum initiatives in Arizona and Ohio (“2008 referendum expenditures”), compared to $3.8 million, or $0.20 per diluted share in fourth quarter 2007;
  • An 8.0% increase in revenues to $61.1 million compared to $56.6 million in fourth quarter 2007;
  • A 5.4% improvement in gross profit from comparable branches (defined as those branches that were open for all of the two periods being compared) over prior year’s fourth quarter; and
  • Adjusted EBITDA, which is earnings before interest, taxes, depreciation, amortization, charges related to stock options and restricted stock awards, and non-cash gains or losses associated with property disposition, of $11.1 million.

** QC Holdings Fourth Quarter 2008**

Total revenues increased $4.5 million quarter-to-quarter, primarily due to higher installment and automobile loan volumes. QC holdings originated $341.0 million of payday loans during fourth quarter 2008, a slight increase over the $339.8 million during fourth quarter 2007. Installment and automobile loan volumes totaled $12.4 million for fourth quarter 2008 versus $9.0 million in prior year’s fourth quarter.

Revenues for comparable branches (those branches that were open for the 15 months since September 30, 2007) increased 2.5%, or $1.4 million, to $57.1 million during the three months ended December 31, 2008. This increase is primarily attributable to growth associated with branches added in 2005 and 2006.

During the three months ended December 31, 2008, the company reported an increase in loan losses to $17.3 million compared to $15.7 million in the same 2007 period. The loss ratio for the current quarter totaled 28.4%, up slightly from the 27.8% in fourth quarter 2007. This small increase reflects a more difficult collections environment. Comparable branches totaled $16.5 million in loan losses during the quarter, which was approximately $500,000 higher than prior year’s fourth quarter.

The company’s revenues grew $16.1 million, or 7.6%, to $227.7 million during the year ended December 31, 2008 versus 2007 as a result of increases in the number of customer transactions (particularly installment and automotive loans) and average loan size.

“As we move into 2009, the sour state of the economy and markets continues to pose challenges. With consumer spending and confidence deteriorating, revenue improvements are unlikely for our core short-term lending branches. Furthermore, such an environment is particularly challenging to the collections process.

“Fortunately, we have a 25-year history of adapting to negative circumstances by responding to customer behaviors in creative, efficient, disciplined and profitable ways. We look forward to adding to that track record during this historically unusual period of time and to solidifying our position as a premier provider of short-term consumer credit.”

For complete financials and additional related QC Holdings results for the fourth quarter 2008, view the press release issued by QC Holdings at:  click on Investment Center