With over 3,000 registered payday loan businesses and an overall population of 25 million people, Texas represents one of the most prolific markets for payday lenders in the industry.

Not only that, but there are many large metropolitan clusters in Texas surrounding the large cities Dallas, Ft. Worth, Houston, Austin, and San Antonio.  There’s a saying in Texas that when the weather is hot, there’s nothing else to do but shop and eat. A typical street corner in Dallas has at least two banks and two fast food restaurants, so consumers are invited to get money and spend money just about every waking moment. Texas highways and byways are set up to prime the capitalistic consumer engine and breed success in the retail business. Intercity freeways are gigantic advertising corridors for anyone who wants to hang out their shingle, making this market a hotbed for business owners.

One such business that has been the beneficiary of that formula is the payday loan industry.  What formerly was a little known product based in check cashing stores or pawn shops, has grown into a professional, regulated, and mainstream industry.  In 2010, it was at $40 billion.

With all the instability in traditional cornerstone investments like the stock market and real estate, many investors have taken a look at the payday loan industry as an option.  The industry is tuned to adapt to the idiosyncrasies of the cash strapped, credit challenged consumer.  Payday loan businesses were built by adapting to many of the problems that Wall Street cannot.

Are you looking for something new?  Are you growing weary of the daily picture that CNN shows you of the beleaguered NYSE trader looking down at his desk after yet another hard plummet of the market?

Consider becoming a lender in the Texas payday loan business.  Reach out to C.A.B. Consulting and Brokerage if you would like to look into it.  We would be happy to tell you what we know and connect you with businesses looking for people such as yourself with money to invest.

Contact C.A.B. Consulting and Brokerage at cabconbrokerage@gmail.com or call us at 214.293.8676.

Payday loan businesses both large and small are doing a lot of things right, profits are strong and many have a very positive outlook.

But, what more can be done to improve the customer’s experience with your company?  Are payday businesses taking stock in what really matters to their customers beyond just the loan transaction?

Where is the customer going after they leave you?  What is going to be done with the money?  Just about all you need to know can be learned by following the trail before and after they come to see you.

Once you have studied customer behaviors, how about taking that knowledge and investing it in programs that are custom tailored to those pathways?  Create a full suite of customer programs that target the issues that cause customers to need your service in the first place. Then compliment that with programs aimed at your customer’s journey after they leave your store.

Examples of programs that might fit this mold: in-store instant bill payment, ATM, internet access for customers, credit improvement, debt consolidation, fax machine usage, rewards programs, gas cards, gift cards, lottery tickets, coupons, text communications, job boards, resume services, child care, health care services, legal representation, etc.

Seek relationships with 3rd party companies who have partner, referral, or affiliate programs.  You will not just be providing additional benefits to your customers, but you can also generate some serious revenue.  These companies are out there, I know of many and they are working hard every day to get involved with our industry.

Trusted payday lenders are uniquely positioned to improve the lives of their customers and a well organized array of programs will only further that value.  It will make your business competitive, interesting, and maybe even cool!  Think about the positive impact that will have on new customer flow, referrals, and bad debt…

There is a lot of legwork that goes into finding the right programs, and ideal 3rd party vendors.  C.A.B. Consulting and Brokerage does have existing relationships in these areas, if you would like to discuss options and learn more, email Michael at cabconbrokerage@gmail.com or call 214-293-8676.

The O.C.C.C. is getting very close to releasing the Credit Access Business License application. It could be another 7 to 10 days, if so that may be Friday, October 21, 2011.

The next O.C.C.C. Finance Committee meeting also happens to be on Friday, October, 21st 2011. In the meeting the “Consumer Disclosure Form for Credit Access Businesses” will be presented along with its accompanying rules. I was recently updated and given a sample document which illustrates some of the disclosures that will be required for a single payment payday loan. There will also be other versions and sample documents released for multiple payment payday loans, single payment auto title loans, and multiple payment auto title loans.

See below for a link to the document – take a look and tell me what you think. Again, this is only one sample and it is not for use in operations. Do you have any comments you wish to make about the disclosure form? Do you feel like this is too much information? Can you easily work this into your process? after you post your comments I will relay them to the Finance Committee.

OCCC.Sample.Disclosure.Form

Submit comments to me via email at cabconbrokerage@gmail.com

Check your work!  Last week my team and I released a blog about Carlos Uresti, a San Antonio based Senator whose offices had been raided by the FBI.  We happened to know that a politician by the name of Uresti in the San Antonio area had also written a bill that would attempt to “cap” all finance charges on Credit Access Business payday, installment, and auto title loans to 25% of the amount borrowed.  Being that I am a rabid defender of our CAB clients, I sprang on the name “Uresti” immediately and assumed he was the same man who had written the bill – which was House Bill 1733.

We made two mistakes on the blog post.  First, State Rep. Tomas Uresti wrote House Bill (“HB”) 1733 and Carlos Uresti did not.  Second, we should have known that a Senator would not write a “House Bill” because they are not in the “House,” they are in the Senate!    This was one day that our team totally messed up on the details – the blame is on me.

These errors were sharply pointed out to me and we pulled down the post right away.  We have a lot of people reading our posts and people count on us to relay information.  It is important to make sure we get them right. This oversight is a fresh reminder that the good old fashioned saying “the devil is in the details” is alive and well.

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 Michael@CreditAccessBusiness.com.

This bill is the second to be authored by Anchia, and is “relating to the repayment of certain extensions of consumer credit facilitated by a Credit Access Business.” CAB’s will need to offer extended payment plans under this bill, where customer would be eligible if certain conditions are met. The conditions are: no plans within the last 12 months with that CAB, the loan has been refinanced at least 4 times, and the plan was requested before the loan went into default. The plans must be requested in writing and be signed by the CAB and the consumer. The CAB cannot charge fees or other charges under the plan, the plan must be 4 payments of equal amounts, and the client would need to be “paid in full” after the final payment, consumer may prepay with no penalty. During the plan, CAB cannot assist consumer in finding additional credit, may not engage in debt collection activity, so long as customer stays on plan. Regarding normal payment schedules on loans in good standing – the bill makes the requirement that multi-payment programs must be fully amortizing, declining principal, with close to equal payments, this was also in HB 886. Also, make note that CAB fees must be refunded if un-earned on an early payoff. The bill goes on to site many of the same existing requirements that we have now, also that the extended payment plan notice must be viewable in store. Goes into effect on 9-1-2013.

Click here for a PDF version of HB 1040! HB.1040