Looking for the best advice in payment processing? Call and get a free consultation Tel. +1.888-255-4596
Online Lenders Facing New Regulations
Loan services companies, especially online lenders, could be facing new regulations from the federal government which would mark a first in the loan industry. The Wall Street Journal reported Sunday that the Consumer Financial Protection Bureau (CFPB) is set to stage talks with a group of small loan service companies to discuss new regulations for payday loans. The goal of the discussions is to set new standards which will enable consumers to repay them more quickly and efficiently.
What is the Risk of the Loan Services Industry?Consumers seeking fast cash that they don’t currently have – usually in the event of an emergency – often turn to pay day or online lenders. The risks of such are the typically high interest rates: Some lenders charge very high interest rates which can keep consumers paying a debt for months afterward. Operation Choke Point, the CFPB’s effort to cease credit card processing for businesses it deems unsavory, was launched in 2013 and continues to target the loan services industry.
Why Are Online Lenders in the Crosshairs?It is really simple: Oversight on lending companies is conducted on a state-by-state basis and not federally. According to the WSJ article, many online lenders do not adhere to state regulations and can carry extensive annual interest rates as high as 500 percent, to extend borrowers cycles of debt. In July, ACE Cash Express of Irving, Texas, was found guilty of predatory lending and was ordered to pay $10 million in restitution to borrowers.
Loan Services Merchant Accounts at InstabillWith Operation Choke Point hovering above the loan industry, it is a delicate time for loan services merchants. Instabill offers quality loan services merchant accounts to those loan businesses that qualify for credit card processing. Following our underwriting process, Instabill can have your loan business accepting credit card payments via our secure payment gateway within a week. Speak with a live representative at 1-800-318-2713 or select the live chat option below.
The backbone of ECS World is our PCI compliant payment gateway. Accept credit cards online, over the phone, or via mail order with our simple and easy-to-use payment processing solution. No hidden fees and no volume caps. Learn more today.
ECS World provides credit card processing services to online and MOTO businesses with its PCI compliant payment gateway solution. Whether you want to process onshore, offshore, or internationally, they have a solution for you!