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DC Attorney General’s Office Takes Action Against EarnIn Over 300% APR Loans
Advocates Applaud Enforcement Action Against the Payday Advance App for Violating DC’s Interest Rate Cap and Deceiving Borrowers with False Claims and Advertising WASHINGTON – In an enforcement action filed yesterday by the Attorney General of the District of Columbia against the payday advance app EarnIn, the AG rejected EarnIn’s claim that its loans are…
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Earnin "Tip" Screenshot
The Earnin app puts in an $11 default “tip” on a $100, 11-day advance. The app discloses “0% APR,” but with a likely $4 expedite fee included, the cost is the equivalent of 498% APR.
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Courts Reject Claims that Payday Loan Apps Don’t Offer Loans
Lenders pushing a new app-based form of payday loan claim they aren’t offering loans and they shouldn’t be covered by state or federal laws governing credit. However, to date, 14 out of 14 courts to rule on the issue have rejected industry arguments and found that wage advances offered through payday loan apps (so-called “earned…
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Earned Wage Payday Loans Compound the Affordability Problem
With Apps Taking $300/year or more from Workers, Lawmakers Should Reject Bills Removing Protections for Active Duty Service Members and Preempting State Payday Loan Laws
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The Affordability Problem of Earned Wage Payday Loans
Payday loan apps take hundreds of dollars a year from people struggling to make ends meet. The apps claim they are not offering loans, but multiple courts have found otherwise. The apps exacerbate affordability problems, leaving people with depleted paychecks, trapped in a vicious cycle of reborrowing, and facing manipulations that multiply fees: Annual percentage rate limits or…
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Selected Government Enforcement Actions Against Earned Wage Payday Lenders
Selected complaints filed in government enforcement actions discussed in the report, Picking Workers’ Pockets: Unfair, Deceptive and Abusive Practices by Earned Wage Payday Lenders, highlights the following enforcement actions taken against providers of earned wage payday lenders: FTC v. Bridge It; FTC v. Floatme; CFPB v. Solo Funds; DC AG v. EarnIn d/b/a Active Hours;…
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The Tricks Cash Advance Apps Use to Coerce Borrowers to “Tip”
A new form of fintech payday loan offered through cash advance apps uses “tips” as a form of disguised interest. These apps claim that tips are voluntary, but they use dark patterns, actual or implied repercussions for not tipping, manipulative interfaces, behavioral and psychological tricks, and other techniques to make tips almost as certain as…
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NY AG Lawsuit Shows Dangers of Fintech Payday Loan Bills
New data shows low-wage workers could pay $700/year or more under pending bills in Connecticut, Maryland, Massachusetts, New York, and other states NEW YORK – The New York Attorney General yesterday filed lawsuits against fintech payday lenders DailyPay and MoneyLion for violating the state’s usury rate laws and engaging in deceptive practices. The lawsuits reveal…
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NCLC’s Year in Consumer Justice: 2024
Advocates made strides to protect consumers from medical debt, junk fees, predatory loans, risky mortgages, hidden car costs, and many other unfair practices.
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CFPB Halts Worker Payday Loan Evasions
Advocates applauded the proposed interpretative rule released today by the Consumer Financial Protection Bureau (CFPB) to address evasions by fintech payday lenders that hide the cost of 300% annual percentage rate (APR) loans and evade state rate caps.
