The New York Times ran a bit of an “expose” on “Earnin,” an online lending FinTech that may need to buckle up for a bumpy ride…

It seems like each week there is a new Silicon Valley FinTech anti-payday loan venture that is launched with millions in funding and all the slick PR you can buy. There is a formula to the launches, and most have the disruptor mindset but at first glance to many observers, it is clearly a well disguised online payday loan business. It was stated in the Post’s article that Earnin has an $800 million valuation – how much of that do you think came from being hyped by the media? Funny thing is, much of the media that promotes these startups don’t do their homework and would tell you they despise the payday industry if you asked them. Imagine that!

Earnin has been around for several years now and the “tip” model they use is now coming into question. They don’t charge a fee for the loan they just say “tip us if you liked it” or something along those lines. The New York Post says Earnin “has been scrambling to escape regulatory heat over concerns that it has been doing illegal payday lending in the Big Apple.”. It was surprising to read that the tips being collected were $14/$100 per week.  That comes to $28/$100 for two weeks. In Texas the average fee range per $100 borrowed is $20-$25/$100 so that tip is really popping up on some radars now. When you calculate the APR on $28/$100 that is getting into the 600%+ APR range which will typically cause a left leaning liberal with consumer advocacy on their mind to simultaneously combust.  
Now, the New York Department of Financial Services appears to be one of those who are very hot under the collar over Earnin doing transactions with New Yorkers. As well, 11 other states are investigating Earnin for violating usury laws. New York sent a subpoena to Earnin in March, shortly after that the tip feature was turned off for New Yorkers. Earnin is now having to explain the switch off, and that loan amounts were not driven down by poor tippers which looks very bad. There were some leaks from former employees apparently. In one of those leaks “Earnin also considered going after perceived enemies. One employee suggested the company hire a private investigator to look into The Post reporter who had written the story” about them. Whoa – this is getting good!

We’ll see how it all plays out, Earnin seems to be getting lined up for a major hit on the chin for other FinTech lending disruptors with similar shell game models. Those who are out in front as Earnin has been, often times are going to have to survive the legal battles to prove out the model while others who are not quite so visible, lay low and quietly ride out the process.

Here is a link to read more from the New York Post:

This blog post was written by Michael Brown, President of CAB Consulting and the Texas Organization of Financial Service Centers. He can be reached at 214-293-8676, or


Back to School is here is your small business ready?

by The CAB Man Texas on August 13, 2019

Did you know that for many the Back to School season each August is the second highest seasonal demand period for the payday industry?  Only the Christmas and New Year Holiday time frame beats Back to School in terms of seasonal demand. For Texas Credit Access Businesses offering cash advances, payday loans, or title loans, now is the time to invest in marketing to new and existing customers.  It is imperative that all of your marketing, promotions, social media, and referral programs are firing and connected.  Campaigns started as early as July 28th and are pushing hard until at least the first day of school. In Texas most have that date set at August 15th.   

Revenue and payment wise, many Members of our group still recall August of 2018 where we had (5) Fridays in the month and also with the way the calendar fell the 1st & 3rd pay dates fell in August, for August in September!  So those things alone meant a record number of payments due and a record revenue month for many.  While we do not have the same thing happening this month with the pay dates, we still have the increase in demand to focus on, so make that marketing happen now! Don’t forget to keep your teams happy, motivated, and focused this month as the workload can increase with higher demand and payment volume.

One great idea to for blog readers that is happening in Central Texas is doing back pack give-away promotion where new customers are entered for a chance to win back packs filled with a variety of much needed school supplies.  This has been warmly received by customers.  Social media has been showing the love with lots of shares and likes of the images we posted of the backpacks so that is very good.

How do we know Back to School demand is here?  There are a number of criteria that paint a very clear picture, for starters lead conversions were up, we saw 12% on one source versus mostly having been in the 5-10% range in prior weeks.

Another sign – loan volume is way up August 1st to 8th versus July 1st to 8th:

  • Funding volume is doubled.
  • New Customers doubled.
  • Online applications up 38%.
  • Reloans doubled.
  • Increases tripled.
  • Denials down 10%.

This blog post was written by Michael Brown, President of CAB Consulting and the Texas Organization of Financial Service Centers.  He can be reached at 214-293-8676, or


A new tool for payday borrowers that may or may not be a good thing for loan defaults.

August 6, 2019

Recently another new dynamic in our industry has surfaced and this is reminder that as a small business owner in the payday loan-cash advance-installment loan industry, everyone on your team needs to continually study and learn customer behaviors.  What is this new dynamic? It is the borrower habit of switching their debit card “on” “off” […]

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Retail “brick and mortar” businesses across many industries continue to shutter. Why?

July 29, 2019

In today’s world of the smart phone, apps, and Amazon, every retail “brick and mortar” business needs to evolve around the newer consumer behaviors in the virtual marketplace.  As surprising as it is, many companies like Toys R’ Us and Sears with decades of brand loyalty just could not make their model compete and evolve in […]

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Strong job market could mean small employers are getting “ghosted” how can you prevent it?

July 24, 2019

This week an interesting article came out in Fox Business (written in Motley Fool) titled “4 reasons hourly workers reject jobs – and what to do about them.”   Many of small business owners in Texas could be seeing a rise in the so-called millennial generation phenomenon of “ghosting.” According to the Urban Dictionary “Ghosting” means the shutdown/ceasing […]

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Texas Debt Buyer Bill is set to be signed by Governor Abbott

June 19, 2019

House Bill 996 a “Debt Buyer Bill” is set to be signed by Governor Abbott.  This particular bill limits when a debt buyer can initiate legal action or arbitration to collect consumer debt. It also requires specific notices to be provided to the consumer with respect to out-of-statute debt.  The new provisions are effective Sept. 1, […]

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AOC and Bernie get slam dunked over their anti-payday loan act.

May 24, 2019

Chris Talgo, a columnist at did a phenomenal job on his recent column regarding Bernie Sanders and AOC’s Loan Shark Prevention Act.  I would say he slam dunked the pair’s “Act” quite nicely.  Within the piece, several hard-hitting facts & statistics were used to counter many assertions made by the two in their recent […]

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Sunset process continues with the OCCC next up is the Stakeholder Meeting to discuss rule amendments.

May 20, 2019

Laurie Hobbs at the OCCC sent out an email to industry “Stakeholders” on Tuesday regarding the continuation of the Sunset process at the OCCC.  Next up is the Stakeholder Meeting to discuss rule amendments.  See below for OCCC’s comments on what will be done and how you can participate. “OCCC would like to inform us […]

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Snapshot on the progress of a five-location retail chain’s Search Engine Marketing Campaign after six months.

May 10, 2019

For the benefit of those who read our posts we are sharing a snapshot on the progress of a five-location retail chain’s Search Engine Marketing Campaign after six months.  This particular business offers cash advances and title loans in the Central Texas area.  What do you think?  Is it doing well with SEO? Room for […]

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Submit your comments to the CFPB by May 15th

May 3, 2019

CFSA has been urging industry stakeholders to submit a comment letter to the CFPB regarding the  “CFPB Rule Proposal to Reconsider the 2017 Payday Lending Rule.”   Again, right now the CFPB ATR and Payment Provisions are on hold which is referred to as a “stay.”  See below for what CFSA is saying we need to do, go […]

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