How do you start a payday loan business?

Payday loans are a rapidly growing industry, however, they are heavily regulated which can be cumbersome. Probably the best way to get into this business is to buy a franchise that has some existing marketing weight. The top franchises appear to be FastBucks, Ace Cash Express and Cash Plus. Before investing your hard earned dollars, make sure to check with your state regulatory agencies to make certain that payday loan businesses are allowed and what the regs are.

It makes very little sense to purchase a payday loan or cash advance franchise. Payday loan franchises typically cost $25,000 to $50,000 one time franchise fee, $65,000 to $125,000 "build-out" fee, and 8% of your gross sales every month. This is all money you could put "on the street" earning you 30% interest per month. In other words, $100,000 working for you for a 30 day period would typically yield $30,000 gross in interest charges. Note: that is "gross" not "net".

Another important reason to dismiss the purchase of a payday loan or cash advance franchise is that the payday loan consumer is not looking for, or even aware, of a specific payday loan brand. A McDonalds of payday loans does not yet exist. Whwn a customer is driving down the street looking for a payday loan or cash advance business, he/she will pull into the very first one they come upon. Even if they just spoke to someone at your store on the telephone!

Finally, no payday loan or cash advance franchisor has yet developed an Internet product. This is where astounding growth will occur!

First answer by Crystal. Last edit by Pauln. Contributor trust: 44 [recommend contributor]. Question popularity: 79 [recommend question]