Most of us are unaware of the multitude of ways an entrepreneur can make money with payday loans (PDLs) and small dollar loans. Often, we are so focused on our own passion, skill, and knowledge base that we don’t understand other methods to monetize our experience and understanding of this dynamic industry. This brief discussion will cover some of the ways we can develop multiple streams of income using all small dollar/payday loan products. If you and your team are uncomfortable or unwilling to finance loans, keep in mind that there are many ways to make a “ton of money” in the small dollar lending industry. (Note that this list is in no particular order.)
* Financing of Loans. Of course, this is the obvious method that most of us use to maximize our returns. We form a corporation, obtain a license where applicable, open our store, use advertising and signage to attract customers, and finance payday loans ourselves. This “brick and mortar” model still works very well. And fortunes are still being made from this approach.
* Using the Internet. Consumers in the US, Canada, Australia, New Zealand, the Caribbean, England, Ireland and more are demanding access to our payday loan product. However, not all consumers have the ability to simply walk into their neighborhood cash advance store and receive one. We are all aware of the states that have unfavorable payday loan legislation. Millions of payday advance consumers are forced to use call centers and company websites outside of the protection their state may offer or the “best practices” promoted by CFSA.net and FISCA.org. And let’s not forget the value of combining a brick-n-mortar payday loan operation with websites. The “big shots” in our industry realized this and bought up existing payday loan internet companies. We perceived the greatest value in taking this approach was the fact that these internet payday loan companies had pursued and secured multiple state licenses. In any case, it only makes sense to use a website in conjunction with your “bricks and mortar”. Fund loan applications submitted through your website by residents of your state/province and simply sell them they’d rather not do business in. (See Affiliates)
* Loan leads. Millions of dollars are being made collecting and negotiating small dollar loan applications and leads. (See Affiliates)
* Consulting. There is a great demand from entrepreneurs to get involved in the PDL industry. His thirst for knowledge on software, licensing and legislation, store locations, website development, ACH processing, prepaid and stored value card implementation, compliance, etc., is endless.
* Affiliates. There has never been more money in the PDL industry from enterprising businesses and individuals who never fund a single cash advance! Tens of thousands of dollars are being made each month simply by creating a website to gather leads and PDL applications and sell them to PDL companies willing to finance the loans. Today, these leads and apps sell for anywhere from $3.00 each up to $100 each, depending on volume, filtering, quality, source, and any due diligence done before the sale. Just one example is a payday loan lead generation entity that sells 50,000 payday advance applications per month at an average of $9.00 each. And the buyer claims to be financing 40% of these leads! We estimate that less than 10% of payday loan websites on the Internet currently finance payday advances. It is extremely easy for an entrepreneur to simply create a website, become an affiliate at http://www.cj.com to immediately start selling payday loans to advertisers. Also, one can set up a Google AdSense account and earn approximately 30-50% of the revenue Google receives for each click (currently $7.02 per click for #1 position). Last month there were 294,000 Google searches for the term “payday loan.” Of course, this count does not include all the other permutations for “payday loan” such as “payday advance,” “cash advance,” “cash advance payday loan,” “no payday loan.” teletrack payday” and many, many more. It also does not include searches made on other search engines such as Yahoo, AOL, Earthlink, MSN, etc. Our research returned over 1,000,000 searches last month for the term “payday loan”!
* Sellers. There is no limit to the various products and services that can be offered to PDL operators and cash advance consumers. Creativity is the key to building continued income in our industry. PDL operators need creative solutions to solve compliance issues, create add-on products, advertising and marketing, collections, build relationships with PDL consumers, customer identification, customer employment validation, bank and ACH account verifications, security, insurance , store design, website and software. integration.
* Investors. There are astute individuals and organizations with a desire to put money to work at favorable interest rates. We receive inquiries from them on a daily basis. Those transactions that do not involve principal generally earn returns of 2% to 5% interest paid monthly. The key for both the PDL operator needing funds to meet demand and potential investors is to thoroughly research and understand the PDL product, develop specific criteria for investment or use of funds, and a full capacity assessment. both parties to work together. Finally, all agreements must be put in writing.
* Education. Opportunities abound to help payday loan operators increase revenue and meet regulatory and compliance issues. Again, topics spanning marketing, advertising, collections, compliance, accounting, insurance, fraud, investing, debt service, ancillary products and services, customer relations, legislation (http://www.PaydayLoanLegislation.com) are just some of the topics. payday advance operators are in need.
* Franchises. Entrepreneurs are crying out for information on how to get started in the PDL industry. Freelancers want a strong brand and well-organized operations that offer excellent and timely support. Turnkey payday advance models will produce the greatest monetary success.
* Trade organizations and magazines. It is shocking to realize how many existing and potential PDL operators, vendors and providers are unaware that we have trade organizations and magazines. Visit and support Fisca and CFSA. And don’t forget our specialized magazine, Cheklist(sic). Cheklist magazine maintains a list of state payday loan and check cashing associations.
The bottom line is this: Entrepreneurs, training organizations, vendors, vendors, educators, consultants, and more all have the opportunity to earn substantial income and recurring income streams by participating in the PDL industry. Success will come with proper research, a good plan in place, follow through and adjustments combined with integrity and honesty.