Tag: ACH (Automated Clearing House) for debiting and crediting borrower bank accounts. Tribe… offshore… choice-of-law…


California Bans ACH for Payday Loans

Bank for payday loan businessCalifornia bans ACH for payday loans? No worries! When 35 million consumers demand access to a product, entrepreneurs always find a way. There’s a fix for this! If you need an alternative to ACH, I’ve got it. Reach out. It’s cheap, proven and works. Jer@TrihouseConsulting.com It’s called Image Check Letter (ICL) and it’s a new, exciting way to enable nearly (no porn or pharmaceuticals) to easily collect payments. Want more info? Inquire about ICL Click Here.

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“California will track consumers who take out payday loans and ban letting online payday lenders getting electronic access to customers’ bank accounts under a new regulatory proposal, according to American Banker.”

“The new rules would require payday lenders to secure loans with a paper check instead of electronic account access. That would make it much harder for online payday lenders to do business — but those lenders are typically much more expensive than storefront lenders and generate more fraud and abuse, and most online lenders don’t have state licenses, according to a 2014 Pew Charitable Trusts report.”

“A payday lender trade group, the California Financial Service Providers Association (CFSP), said the new rules “would have a high probability of forcing many or most” of its members out of the payday loan business. The group’s members are all state licensed, it said.”

“But a spokesman for the California Department of Business Oversight said that reducing online payday lending “may not necessarily be a bad thing. The spokesman, Thomas Dresslar, added, ‘The more the scope of payment instruments expands beyond paper, the more dangerous the market becomes for consumers. It’s not the storefront operations that are the problem. It’s the activity on the Internet.”