Payday Pundit

The Minnesota Department of Commerce has issued new rules.  From the article:

Out-of-state lenders who provide short-term consumer loans against workers’ next paychecks will be subject to Minnesota law and licensing requirements, the Minnesota Department of Commerce ruled Friday.

Kevin Murphy, a deputy commissioner in charge of state-licensed financial institutions, said the volume of so-called payday loans has “exploded” on the Internet and the state has started to get consumer complaints about fees and unresponsiveness of out-of-state lenders to their questions.

“We’ve had a small number of complaints from Minnesota consumers about Internet-based payday lenders,” Murphy said. “We’ve had very few complaints about payday lenders who have a physical presence here.”

Did you get that: “Very few complaints about payday lenders who have a physical presence here.”  That could be said about almost every state.   That’s why it’s so foolish to impose rates caps, cripple storefront payday lenders, and force consumers into risky Internet loans.