Payday Loan Industry Guidelines
Supporting CFSA Best Practices with Fast Payday Loans
Pay-dayloan.com encourages responsible payday loan industry practices that offer appropriate consumer protections. We support and abide by the following CFSA Best Practices. We value your trust in us and we appreciate having the opportunity to serve you.
- Full disclosure. A member will comply with the disclosure requirements of the State in which the payday loan office is located and with Federal disclosure requirements including the Federal Truth in Lending Act. A contract between a member and the customer must fully outline the terms of the payday advance transaction. Members agree to disclose the cost of the service fee both as a dollar amount and as an annual percentage rate ("APR").
- Compliance. A member will comply with all applicable laws. A member will not charge a fee or rate for fast payday loans that is not authorized by State or Federal law.
- Truthful advertising. A member will not advertise the payday loan service in any false, misleading, or deceptive manner.
- Encourage consumer responsibility. A member will implement procedures to inform consumers of the intended use of the payday loan service. These procedures will include notifying consumers that a payday loan is a short-term cash flow tool not designed as a solution for longer term financial problems and informing customers of the availability of credit counseling services.
- Rollovers. A member will comply with State laws on rollovers (the extension of an outstanding advance by payment of only a fee). In States where rollovers are not specifically allowed a member will not under any circumstances allow a customer to do a rollover. In the few States where rollovers are permitted, a member will limit rollovers to four (4) or the State limit, whichever is less.
- Right to rescind. A member will give its customers the right to rescind, at no cost, a payday loan transaction on or before the close of the following business day.
- Appropriate collection practices. A member must collect past due accounts in a professional, fair and lawful manner. A member will not use unlawful threats, intimidation, or harassment to collect accounts. CFSA believes that the collection limitations contained in the Fair Debt Collection Practices Act (FDCPA) should guide a member's practice in this area.
- No criminal action. A member will not threaten or pursue criminal action against a customer as a result of the customer's check being returned unpaid or the customer's account not being paid.
- Enforcement. A member will participate in selfpolicing of the industry. A member will be expected to report violations of these Best Practices to CFSA, which will investigate the matter and take appropriate action. Each member company agrees to maintain and post its own toll-free consumer hotline number in each of its outlets.
- Support balanced legislation. A member will work with State legislators and regulators to support responsible legislation of the payday advance industry that incorporates these Best Practices.
- Relationships with financial institutions. A member may market and service payday loans made by a federally insured financial institution, provided the financial institution does the following: (1) sets its own credit criteria; (2) approves and funds each advance; (3) complies with applicable State disclosure requirements, where not inconsistent with Federal law; (4) complies with applicable State law as to the number of rollovers; (5) permits the member to purchase no more than a de minimis amount of the advances, or any such other amount which may be consistent with safety and soundness determinations by Federal or State banking regulators; (6) complies with the guidelines and regulations on payday lending issued by the financial institution's Federal or State regulator; and (7) complies with these Best Practices unless the Best Practices conflict with this Paragraph, in which case the terms of this Paragraph shall apply.
- Military. A member will comply with a separate code of Military Best Practices that addresses the unique circumstances of active duty military customers. These special consumer protections include, among others: a prohibition on the garnishment of military wages or salaries and on contacting the military chain of command to collect payment; and the establishment of financial literacy initiatives that will benefit service men and women.