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What Is a Payday Advance?

Getting to Know Our Product: The Payday Advance and How It Works

A payday advance is a financial instrument that provides consumers with a small-dollar, short-term loan. With an application process that is convenient and easy to understand, customers have access to a financial option intended to cover small, often unexpected, expenses. Borrowers may also choose to use our product to avoid costly bounced checks, overdraft protection fees, late bill payment penalties, or other less desirable short-term credit options.

To obtain an advance, a customer is required to have:

  • An active checking account,

  • Proof of a regular income,

  • Proper identification,

  • Upon completion of a simple application and approval, a borrower must read and sign an agreement containing disclosures required by the Truth in Lending Act (TILA), and

  • Write a personal check for the amount of the advance plus a fee.

The lender immediately advances the customer funds, but holds the check until an agreed upon date (usually within two to four weeks) when the borrower receives his/her next paycheck. On the agreed upon date, either the check is deposited or the customer returns with cash to reclaim the check.

Affected by Natural Disasters

Affected by Natural Disasters

University of Chicago, finds that the existence of payday lenders benefits communities struck by natural disasters.Continue Reading

Best Practices

Best Practices

CFSA ensures responsible conduct among lenders, protects borrowers’ rights, and encourages self-governance of the payday advance industry.Continue Reading

Better Financial Footing

Better Financial Footing

If you are a consumer and have found yourself in financial straits, here are a few quick tips on how to rebuild or repair your credit history.Continue Reading

Can’t Compete

Can’t Compete

While FDIC considers its Small Loan Program a success, small dollar loans from banks cannot compete with the cost and ease of payday loans.Continue Reading

Consider the Facts

Consider the Facts

Many prominent researchers have examined the payday advance, here is a look at some key findings.Continue Reading

Credit Unions Fall Short

Credit Unions Fall Short

The reasons why traditional financial institutions have been reluctant to offer payday loan alternative products.Continue Reading

Customer Demographics

Customer Demographics

Our customers are the face of America: Men and women with families and jobs. Continue Reading

Know Your Fee

Know Your Fee

The important info you need about the states in which the payday lending industry operates. Continue Reading

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Connecting With Our Communities

Managing household finances can be a daunting task. However, by using solid budgeting and savings techniques, you can accomplish major financial goals. In the Customer Resource Center, CFSA offers a variety of payday advance resources that support and encourage responsible lending practices, and highlight the vital role of our members’ stores in neighborhoods near you.


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TO OUR MEMBERS

Thanks for visiting the CFSA Web site. CFSA values you as a member. Consequently, we are constantly seeking new ways to enhance your membership experience. As such, the information in this section is restricted to members only. If you are a CFSA member, please enter your username and password. If you have forgotten your login info, send an e-mail to Member@CFSAA.com.

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TO OUR PARTNERS

Here you will find an aggregate of industry research, comprehensive data, and benchmarking tools from the short-term lending industry. They cover all payday advance business areas – consumer demographics, media hits, the latest policy initiatives, among others. Click here to access to the partner's resource library.

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For Our Policymakers

CFSA works at the federal, state, and local levels educate legislators and regulators about the role of payday advances in the broader financial services arena. This section provides resources for policymakers who believe in access to credit, want to preserve financial options and ensure balanced, substantive consumer protections. Click here to enter the Policymaker Resource Library.