The Payday Loan Industry May Have Gotten Lucky

Dec 24, 2014

The Consumer Financial Protection Bureau has pushed back three anticipated decisions, one of which is a proposal on payday lending. The proposal on payday lending is set to be addressed within the first seven months of 2015. Payday lending companies like, Cash America, EZCORP and First Cash Financial, are expressing relief at the delay as many in the industry fear that the new CFPB rules will be more harsh and constrictive than the payday lending industry is used to.

CFPB Delays

Payday loans give individuals short term loans, often within 24 hours, but then demands the loans back quickly. In addition to a quick return on loans, payday lenders charge large amounts of interest that must be returned along with the original loan.

The CFPB will be considering the institution of more policies concerning what type of rules are appropriate and warranted under CFPB authorities. Some proposed rules are disclosures or address acts and practices in connection with their products.

When the CFPB announced its intent to make more rules regarding the debt and payday loans industry, it received over 23,000 comments. Some experts speculate that the sheer volume of responses are responsible for the delay. Most in the industry now believe the delay will slow down any new regulations from taking effect until 2016. The CFPB states that it is currently developing a survey to determine consumer needs and complaints relating to payday loans. They are also engaging in qualitative testing to determine what information that consumers can provide to help create more rules.

Payday Loan Merchant Account

The delay by the CFPB has given payday loan merchants an additional year to make profits and to adjust business practices in anticipation of impending regulations. has the payday loan merchant account managers that can keep your payday business generating profit.

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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