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‘Rent-a-Bank, Rent-a-Tribe’

‘Rent-a-Bank, Rent-a-Tribe’

Very little is straightforward concerning the battles which were waged on the decade that is past a half over just how payday loan providers conduct business.

When you look at the 1990s, as some states started enforcing restrictions on whatever they could charge, numerous payday lenders teamed with out-of-state banking institutions to evade interest-rate caps in states with strict restrictions on finance fees.

Under federal legislation, a state-chartered bank could “export” rates of interest allowed in its house state to a different state — utilizing one state’s free interest-rate guidelines to create loans in a situation where interest levels had been capped.